
Class HH_l 



Book. 



,T 



Copyright N 



.lUIAt. 



G0EXRIGIIT DEPOSIT. 



OIL AND GAS RIGHTS 



On the Public Domain and on Private Lands, Discovery and 

Location of Oil Placer Claims. The Withdrawal Acts, 

Leases and Other Contracts between the Owner 

and the Operator Including Forfeiture 

and Protection against Drainage 



THE SINKING, PUMPING AND SHOOTING OF WELLS 
STATUTES, DECISIONS AND FORMS 



The Oil Leasing Act of 1920. The Regulations of the Interior 

Department and Procedure to Procure Permits and 

Leases and Protect Titles under That Act. 

For the Legal Profession and Oil 

Prospectors and Companies 



By 

R. S. MORRISON AND EMILIO D. DE SOTO 

Of the Colorado Bar 



SAN FRANCISCO, CAL. - - 

BENDER-MOSS COMPANY 

Law Book Publishers 






s<°° 



*{& 



COPYRIGHT 1920 

BY 

R. S. MORRISON AND EMILIO D. DE SOTO 



E. R. Andrews Printing Company, Rochester, N. Y. 



| 

©CI.A605286 



•\ . j^ % 



PREFACE. 

The Passage by Congress of what is known as the Oil and Gas 
Leasing Act, by which all deposits of Coal, Phosphate, Sodium, 
Oil, Oil Shale and Gas were withdrawn from the public domain, 
and the disposition and control of such deposits taken over by 
the Government under Regulations promulgated by the Secre- 
tary of the Interior, suggested the necessity of this work. 

It is intended to set forth the latest decisions and principles 
concerning the rights of the owner in fee of lands not affected 
by the Act, containing oil and gas deposits ; the rights of lessors 
and lessees of oil and gas lands, and of all persons who have 
contractual relations concerning the same, and to treat upon the 
various topics and subjects incident to the laws governing the 
owning, leasing, production, sale and transportation of oil and 
gas, with the latest text of the statutes of the different states 
which have legislated upon oil and gas rights. 

A full text of the Oil and Gas Leasing Act is given with an 
analysis of its provisions. An attempt has been made to con- 
strue its sections where the meaning of any of them seems to 
be obscure or uncertain, and the latest decisions of the Depart- 
ment construing some of the provisions of the Act are given. 

The regulations of the Secretary of the Interior are printed 
in full, and a knowledge of these regulations concerning each 
mineral affected by the Act is necessary to an understanding of 
(he right given by the law to prospect for, or secure leases to 
work, such minerals, and the required forms for securing permits 
and leases under the Act are given together with other useful 
forms pertaining to the subject matter of the book. 

Morrison & De Soto. 
Denver, Colorado. 



TABLE OF CONTENTS. 

CHAPTER 1 

PAGE 

Introductory 1-7 

CHAPTER 2 
Mineral Character of Oil and Gas 8-10 

CHAPTER 3 
Ownership of Oil and Gas Lands 11-14 

CHAPTER 4 
Conveyance of Oil and Gas Lands 15-17 

CHAPTER 5 

Severance, Exception, and Reservation of Oils and 

Other Minerals 18-19 

CHAPTER 6 

Fugacious Character of Oil and Gas 20-23 

Ferae Naturae of Oil and Gas 20-23 

CHAPTER 7 

Judicial Notice of the Character and Manner of 

Mining of Oil and Gas 24-25 

CHAPTER 8 

Oil and Gas-Oil Wells and Gas Wells Distinguished 26-31 

v 



VI CONTENTS 

CHAPTER 9 

PACE 

Protection to Be Given to Oil Wells and Other In- 
cidents 32-40 

CHAPTER 10 
Lease — Introduction to the Subject 41-42 

CHAPTER 11 
Leases and the Parties to Them 43-50 

CHAPTER 12 
Lease and the Term Thereof 51-54 

CHAPTER 13 
Lease and the Contract Made by the Parties .... 55-61 

CHAPTER 14 
Lease and the Construction of the Terms Thereof 62-65 

CHAPTER 15 

Lease and the Consideration Expressed Therein . . 66-70 

CHAPTER 16 

Lease and the Question of Bonus as Consideration 71-72 

CHAPTER 17 

Lease and Question as to Unilateralness and Mu- 
tuality 73-7i> 

CHAPTER 18 

Lease and Bights op Parties to Surrender the Same 76-81 



CONTENTS Vll 

CHAPTER 19 

PAGE 

Lease and the Covenant to Sink to Oil or Gas 82-87 

CHAPTER 20 

Lease and the Number of Wells Which May Be Re- 
quired for Protection 88-89 

CHAPTER 21 

Lease — The Term Thereof. Finding Oil and Gas in 

Paying Quantities 90-93 

CHAPTER 22 

Lease and the Rights of the Parties as to Rents 
and Royalties 94-102 

CHAPTER 23 

Lease and the Rights of Parties to First and Second 

Leases 103-105 

CHAPTER 24 

Lease and the Assignment Thereof 106-108 

CHAPTER 25 

Lease— Rights Between Surface Owners and 

Lessees 109 

CHAPTER 26 
Lease and the Abandonment Thereof 110-112 

CHAPTER 27 

Forfeiture of Leases and the Rights of Parties 

Thereto 113-124 



Vlll CONTENTS 

CHAPTER 28 - 

PAGE 

Option — Sufficiency of Consideration and Rights 
of the Parties Thereto 125-129 

CHAPTER 29 
License and the Rights of Parties Thereunder . . . 130-131 

CHAPTER 30 

Contracts for the Sinking of Wells and the Rights 
of Parties in Such Contracts 132-138 

CHAPTER 31 

Partnership — What Creates the Relation and the 

Duties Between Partners 139-141 

CHAPTER 32 
Net Profits and Covenants Concerning the Same . . 142-143 

CHAPTER 33 
Open Mines and Right to Work the Same 144, 145 

CHAPTER 34 

Laches and Statutes of Limitations as Applied to 

Oil and Gas 146-148 

CHAPTER 35 

Statute of Frauds as Applied to Oil and Gas Leases 149, 150 

CHAPTER 36 
Fkaid as Incidents to Ojl and Gas Contracts 151-153 



CONTENTS IX 

CHAPTER 37 

page 
Taxation of Oil and Gas Land, and Proceeds There- 
of 154-160 

CHAPTER 38 

Police Power and City Ordinances in Their Control 
of Oil and Gas Operations 161-162 

CHAPTER 39 
Inspection of Wells in Controversy and of. Oils . . 163, 164 

CHAPTER 40 

Pipe Lines — Their Right on the Public Domain and 
as Common Carriers 165-168 

CHAPTER 41 
Interstate Commerce and Transportation 169-170 

CHAPTER 42 

Negligence, Explosions and Other Incidents 171-175 

CHAPTER 43 

Nuisance as Applied to Oil Wells and. Other In- 
. ctdents of Oil 176-178 

. CHAPTER 44 
Fixtures as Applied to Machinery for Oil Wells . . 179-181 

CHAPTER 45 

Pumping — Rights of and Limitations upon Opera- 
tions . 182-184 



X CONTENTS 

CHAPTER 46 

PAGE 

Shooting of the Well 185-186 

CHAPTER 47 

Waste of Oil or Gas and the Rights of Lessor and 
Lessee Concerning the Same 187, 188 

CHAPTER 48 
Jurisdiction of Courts on Oil Questions 189, 190 

CHAPTER 49 

Ejectment as Applied to Oil, Gas and Coal Lands . . 191-193 

CHAPTER 50 

Injunction and Receivers in Matters Pertaining to 

Oil Operations 194-200 

CHAPTER 51 
Trespass and Trover 201 

CHAPTER 52 

Specific Performance of Contracts Concerning Oil 
and Gas 202-204 

CHAPTER 53 . 
Partitions of Oil Lands and Leases 205-206 

CHAPTER 54 

Measure of Damages as the Same Applies to Oil and 
(Tvs Operations 207 -213 



PAGE 



CONTENTS XI 

CHAPTER 55 

Insurance as Applies to Losses, Occasioned by Oil . . 214-215 

CHAPTER 56 
Indians and Their Rights in Oil Lands 216-219 

CHAPTER 57 
Coal Land and Its Disposition by the Government . . 220-221 

CHAPTER 58 
Oil Shale and Manner of Its Location 222, 223 

CHAPTER 59 

Locations of Oil Placer Claims and Their Rights 

Since the Passage of the Oil Leasing Act 224-244 

CHAPTER 60 

Application for Patent and the Improvements 'Re- 
quired 245-246 

CHAPTER 61 

Patent to Oil and Other Lands and Its Conclusive- 
ness 247-250 

CHAPTER 62 

Land Office, Its Duty and Jurisdiction in Land 

Matters 251-254 

CHAPTER 63 

The Withdrawal Acts and Dec t sions Pertaining to 
the Rights of Owners within the Withdrawn 
Areas 255-259 



Xll CONTEXTS 

CHAPTER 64 

PAGE 

Introduction to the Oil Leasing Act of 1920 260-261 

CHAPTER 65 

Full Text of the Oil Leasing Act 2 62-2 93 

Analysis of the Sections of the Oil Leasing Act . . 294-306 

CHAPTER 66 

Permits and Leases on Nonproven Ground under 

the Oil Leasing Act 307-322 ' 

CHAPTER 67 

Procedure to Procure Oil Lease on the Known- 
Geological Structures 323-325 

CHAPTER 68 

Land Office Regulations Issued under the Oil Leas- 
ing Act 326-416 

Decisions on the Force and Effect of the Regula- 
tions . . 326-329 

Oil and Gas Regulations 330-367 

Land Office Construction of the Leasing Act 367-377 

Phosphate Regulations 377-393 

Sodium Regulations 396-414 

CHAPTER 69 

Subheads of the Act and Rules Covering the Min- 
erals, the Parties and the Leasable Domain .... 417-420 

CHAPTER 70 

Subheads of the Act and Rules Covering Pref- 
erences, Permits and Leases 421-424 



contexts xiii 

CHAPTER 71 

PAGE 

Subheads of the Act and Rules as to Rents and 
Royalties 425-427 

CHAPTER 72 

Subheads of the Act and Rules as to Renewals, Ex- 
tensions, Surrender, Readjustment, Easements, 
Subleases and Forfeiture 428-429 

CHAPTER 73 

Subheads of the Act and Rules on Easements, Pro- 
tection and Taxes 430-431 

CHAPTER 74 

Subheads of the Acts and Rules on the Proclama- 
tion and Relief Clauses 432, 433 

CHAPTER 75 

Subheads of the Acts and Rules on Controverted 

Claims 434, 435 

CHAPTER 76 

Subheads of the Act and Rules ox the Deprecatory 

Clauses 436-438 

CHAPTER 77 

Subheads of the Act and Rules ox Practice and 
Miscellaneous 439 



CHAPTER 



Oil Shale Regulations of the Land Office and 

Forms of Petition axd Lease 440-454 



XIV CONTEXTS 

CHAPTER 79 ■ 

PAGE 

Coal Land Regulations 455-488 

CHAPTER 80 
Forms of Oil and Gas Lease 488-501 

CHAPTER 81 

Withdrawal Legislation, The Naval Reserves and 
The Forest Reserves as the Same are Affected by 
the Oil Leasing Act 502-516 

CHAPTER 82 

Texas and the Oil and Gas Laws thereof which are 
Unaffected by the Oil Leasing Act 517-552 

CHAPTER 83 

State Statutes Giving the Laws of the Various 
States Which Have Legislation Concerning Oil 
and Gas 553-796 

CHAPTER 84 

Oil Inspection Laws Giving Full Text of the In- 
diana Inspection Act 797-810 

CHAPTER 85 

Blue Sky Laws — Digest of the Laws of the Several 
States 811-821 

CHAPTER 86 

Alaska Coal with Text of the Act of 1914 Con- 
trolling Coal Lands in That Territory 822-865 






CONTENTS XV 

CHAPTER 87 

PAGE 

Statutory Legislation on Placer Locations 866-877 

CHAPTER 88 

Application for Placer Patent with Forms of Ap- 
plication upon Surveyed Lands 878-898 

CHAPTER 89 

Easements — Digest of the Several Acts Granting 

Rights of Way with a Discussion of the Same . . 899-905 

CHAPTER 90 

Forms of Articles of Incorporation, Trust Agree- 
ments and Drilling Contracts 906-957 

Glossary .". 957-981 



MORRISON'S OIL RIGHTS. 



CHAPTER 1. 

INTRODUCTORY. 



Oil and natural gas have been known locally from the earliest 
times as mere natural curiosities. Not until within the last sixty 
years has it been learned that they are to be found in incredible 
quantity at great depths under immense and widely scattered 
areas. Within that time these deposits have become storehouses 
of wealth and power so that their pursuit and production have 
come to be classed as one of the great industries of the world. 

Oil Fields. 

In the United States they are found under almost all of its 
central portion, excluding New England, the States bordering 
on the Atlantic, the Northwest corner and the Northern tier of 
States. 

The first known and perhaps the largest oil field extends from 
western New York and Pennsylvania to Illinois, including West 
Virginia, Kentucky, East Tennessee and Northern Alabama. 

The Oklahoma oil field extends into Kansas and Arkansas, 
and there is a vast extent of oil territory in Texas and Louisi- 
ana. It is found again in quantity in California. There is a 
local field in Colorado and another in Wyoming. It is found in 
smaller amounts in almost every locality exclusive of the areas 
above mentioned. 

The great oil fields of the world outside of the United States 
are Mexico, Ontario, Burma, the Baku District in Russia, and 
Galicia. It is found in New Zealand, but so far not in Australia, 
M. O. R.--1. 



2 MORRISON'S OIL RIGHTS 

altho bored for there, in many places. It is found in many other 
parts of Europe, Africa and Asia, in Ecuador, Peru and other 
parts of South America, but notwithstanding its supposed rela- 
tion to coal it has never been found in commercial quantity 
among the great coal deposits of England. 

Its geological deposition is not confined to any one period. 
It is found in almost every sedimentary stratum excluding the 
volcanic and eruptive formations. It is generally conceded to 
be of animal or vegetable origin. 

It began to acquire its economic importance from the drilling 
of the first well at Titusville, Pa., in 1859. 

Classical and Scriptural Mention. 

Upon the announcement of any alleged discovery comes im- 
mediately the denial that it is new and in most instances 
such traverse is made good: Hints of the telephone and experi- 
ments with the automobile are shown up long before they be- 
came accomplished facts. Even the steam engine goes back to 
Hero of Alexandria one or two centuries before the Christian 
Era. 

Oil and gas are no exceptions to the rule. They were known 
to the Chinese and Japanese and are mentioned by numberless 
ancient writers and travelers, Marco Polo, of course, not ex- 
cepted, but they never became commercial industries until the 
last half of the nineteenth century barring the limited working 
of the Baku Oil field hundreds of years ago. 

Oil springs or fountains of gas are mentioned by Strabo, 
Pliny, and Herodotus. Plutarch describes "a gulf of fire which 
streamed continually as from an inexhaustible source" which 
was shown to Alexander the Great. 

Job, chap. 28, 1-11, is the oldest known description of a mine, 
expressed in the poetic language of the orient but "The rock 
poured me out rivers of oil," chap. 29, 6, is only a figure of 
speech. Deuteronomy 32, 13 speaks of "oil out of the flinty roek." 
But in the first chapter of the second Book of Maccabees there 
is undoubted reference to petroleum in a mysterious narrative 
going back to the fire worshippers and strange to say accounting 
for the origin of the modern term "naphtha." 



INTRODUCTION 6 

Interesting accounts of the ancient history of oil are found 
in Brannt on Petroleum in Sir Boverton Redwoods' work and in 
the first chapter of Thornton on Oil and Gas. 

Quantity. 

The quantity of oil or gas to be expected may be a mere mois- 
tening of the well or a yield wholly insufficient to pay for opera- 
tion much less to refund the cost of sinking. 

Enlarging from this come a class of wells that may be likened 
to the petty business of life, where the margin of profit, in any 
event small, depends on the industry and good judgment of the 
manager of the well. From such small results it may advance 
to full repayment of expenditure and heavy interest upon the 
capital. 

At the other extreme there are instances, and many of them, 
scattered over widely separated fields, where oil has been struck 
yielding thousands of barrels per day and natural gas in iavish 
quantity. 

In the original Pennsylvania field, the Oil Creek region, the 
Philips "No. 2 well gave a stream of 4,000 barrels per day. It 
yielded nearly 1,000,000 barrels the first year. Struck in 1861 
it was not shut down till 1873. Another well close by yielded 
o,000 barrels per day. 

The Maple Shade well struck in 1863 started at 1000 barrels 
per day and is said to have yielded $1,500,000 profit to its 
owners. 1 

In the Baku county, Russia, in 1877 a well at 280 feet poured 
out for three months about 270,000 gallons daily, all of which 
Avas wasted. A well called Shaitan Bazaar (Satan's Shop) at 
490 feet brought 4,000,000 gallons per day which was mostly 
wasted. 

In 1883 No. 14 of Mirzoeff spouted irregularly from 20,000 
to 400,000 galons daily. Nobel No. 25 well yielded 2,000,000 
gallons daily. The Droobjia Fountain in 1883 produced at a 
value in money of £11,000 daily. It shot up over 200 feet high, 

1 Baker and Hanior, p. 223. 



4 MORRISON'S OIL RIGHTS 

utterly wrecking the rig that gave it vent to the surface, and 
flowed into chanels merging into little lakes. 

The Zubuloff well threw up its oil 350 feet above the casing. 
In the same region a well yielding over 500,000 poods per day 
caught fire which extinguished itself by the well becoming 
clogged. 2 

Other strikes in Mexico, Louisiana, Texas, and in fact in most 
of the large oil fields have rivaled these instances. As a matter 
of course seldom have facilities been at hand to meet such rushes 
and there has been judicial recognition of such fact as excusing 
strict compliance with the terms of the lease. 

In the Baku region natural gas was tapped that poured forth 
with such tremendous energy that it seemed to threaten to ex- 
haust all possible source of supply and more than one of such 
wells where no means existed to save the product were known as 
outlaws, rogues, or robbers. 

Where such wells have caught fire they have exhibited illum- 
ination and conflagration comparable only to small volcanos and 
their extinguishment has taxed the ingenuity of experts. 

Such occurrences are needed to impress on the mind the over 
lavish generosity of nature, giving life, health and motion from 
overflowing storehouses, built up from the billions of individuals 
of forms of lowly life, aggregated into multitudinous and bound- 
less supply of energy and power, accumulated through untold 
ages prepared since the foundation of the world. 

Associated Fluids. 

Along with oil and gas may be associated salt water and fresh 
water both of which affect the sought for results. 

Where two wells are close neighbors the water supply in one 
may affect the oil supply in another. In the case of the two 
Pennsylvania wells above mentioned when either ceased work- 
ing only water came from the other. 

This commingling of fluids and gases indicates underground 
reservoirs advancing to the stage of flowing subterranean 
streams to fill the artificially produced vacuums, compelling rc- 

2 Sir Boverton Redwood, p. 7. 



INTRODUCTION 



5 



sort to mechanical devices to save the good and lose the bad, 
combined in the output and brought to the surface together. 

And when it comes to the manipulation of the product even 
before it leaves the plant, industry must get to work to produce 
changes before marketing which renders oil and gas production 
a field for ingenuity and adds some intellectual pleasure to the 
mechanical acts of sinking and pumping. 

Poison gas may be struck or sulphur, and when the bore pene- 
trates coal, especially through an opened mine, its gas threatens 
complications dangerous to the bore and the bore is not friendly 
to the mine. 

Chemical Composition and Other Incidents. 

Petroleum is a combination of at least thirty hydrocarbons. 
The variations in these hydrocarbons and associated elements 
determine its fitness for light, heat or lubrication and its com- 
mercial separation into naphtha, benzine, gasoline or kerosene. 

In color, the crude oil shows shades of green, yellow and 
brown. The odor varies with the color. The specific gravity 
runs from 0.650 to 0.9960. A Mexican sample has even been 
claimed to exceed 1 so that it would sink in water. The theory 
that its specific gravity has any relation to the depth at which 
found does not seem to be verified to any practical results but 
in certain kinds of contracts specific gravity "constitutes the 
simplest means of controlling deliveries of petroleum." * Its den- 
sity increases on exposure to air, varying in different districts. 

In certain statutory tests the Baume scale is required to be 
used, a hydrometer going back to a publication by Antoine 
Baume about 1768, a scale originally as unsatisfactory as the 
thermometer of Fahrenheit, which, based on an arbitrary start- 
ing point, has produced endless confusion in heat measurements. 

The by-products of oil and gas are innumerable, ranging from 
dye-stuffs to vaseline, including the duplication of natural prod- 
ucts by the process called synthesis and covering all the results 
originally extracted from shale, coal, and tar. 
| The expansion of oil by heat, its inflammability at certain de- 

1 Bacon and Hamor, p. 94. 



6 MORRISON'S OIL RIGHTS 

grees, its base, whether paraffin or asphalt, are all points largely 
foreign to the scope of this book but of importance in the con- 
tracts of the refineries and other plants and the immense volume 
of manufacture and commerce which have developed from and 
followed the output of the original crude oil. 

Source of Title. 

In the Public Domain States on the Pacific Coast and on the 
Rocky Mountain slopes, the titles largely became initiate under 
the placer mining Act of 1870. In the older States they depend 
on common-law grants, but even in the States lately territories 
much oil value exists under agricultural entries. 

The future acquisition of oil rights on the Public Domain 
will come under the Leasing Act of 1920. 

Judicial Notice. 

Before we consider the numerous subdivisions of the subject, 
it may be here remarked that many of the incidents peculiar to 
oil and gas are judicially noticed and there is no industry where 
the courts assume to know so much about what may be called 
the trade secrets of the business, as in the suits involving oil and 
gas, their production, handling and distribution, from the pro- 
ducer to the ultimate consumer. 

Early Decisions. 

Hail v. Reed, 15 B. Mon. (Ky.) 479, 11 M. R. 103, was decided 
in 1854. It was replevin for three barrels of "American Oil" 
worth $1.25 per gallon, extracted from a hand sunken well. It 
held that the severance of the oil from the freehold did not 
prevent its recovery by personal action and that the case is not 
analogous to the surface owner's right to streams of water. 

J n 1859 when the fact that oil could be discovered by sinking 
was a very recent novelty, McGluire, the owner, gave to one 
Baird, written authority for a valuable consideration to pros- 
pect for oil. Under this contract between $120,000 and $30,000 
were expended. The courl gave a critical exposition of the Con- 
tract treating it as an executed license of which the second party 



INTRODUCTION i 

could not be arbitrarily ousted but denied all relief on the 
technical point that the contract being only a personal license 
and therefore not assignable and Baird having assigned it or 
sublet under it, had lost all right to the premises. Dark v. John- 
ston, 55 Pa. 164, 93 Am. Dec. 732, 9 M. R. 283. 

A decision so unjust in its practical results would hardly be 
expected from any Court at this day when the subject has been 
exploited by thousands of cases. 

French v. Brewer, 3 Wall. Jr. 346, Fed. Cas. No. 5,096, 11 
M. R. 108, decided in 1861 justly holds that contracts made in 
ignorance of the subject matter should be construed with due 
regard to that fact. 

It involved the construction of a contract drawn in 1854 by 
an ignorant scrivener giving the privilege of taking oil from a 
tract on Oil creek at a place where oil was collected on the sur- 
face of the water, and while the lease was in force the art of 
finding oil by drills had been discovered. It was on motion for 
preliminary injunction and the only point decided, except the 
suggestion above noted, was that the injunction should be denied 
where present injury would result to the respondents while the 
sinking of the new wells would be an ultimate benefit to the 
complainants. The case seems never to have been carried fur- 
ther. 



CHAPTER 2. 

MINERAL CHARACTER. 

Oil and Gas are Minerals. 

That oil and gas are minerals has been almost everywhere 
decided. The question has arisen frequently on the construc- 
tion of deeds reserving all minerals and in Government grants 
excepting minerals. Chino Land & Water Co. v. Hamaker (Cal. 
App.) 178 Pac. 738; Barker v. Campbell-Rat cliff L. Co. (Okla.) 
167 Pac. 468 ; Be Moss v. Sample, 143 La. 243, 78 So. 482 ; Mur- 
ray v. Allred, 100 Tenn. 100, 66 Am. St. Rep. 740, 39 L.R.A. 
249, 43 S. W. 355 ; Texas Co. v. Daugherty, 107 Tex. 226, 176 
S. W. 717; Lanyon Zinc Co. v. Freeman, 68 Kan. 691, 1 Ann. 
Cas. 403, 75 Pac. 995 ; Ontario N. G. Co. v. Smart, 19 Ontario 
595. Even the right to operate for oil and gas has been held to 
be a reserve of those minerals. Jamison Coal, etc., Co. v. Car- 
negie N. Gas. Co., 77 W. Va. 30, 87 S. E. 451. And a grant of 
the royalties has been construed as a grant of the oil. Paxton v. 
Benedum-Trees Oil Co., 80 W. Va. 187, 94 S. E. 472. 

The argument in favor of construing oil and gas to be minerals 
is so strong and this construction so uniform that it is beyond 
dispute almost everywhere. 

Only in Pennsylvania and Ohio there are decisions holding* 
oil and gas under general reservations, to be nonmineral. Pres- 
ton v. South Penn Oil Co., 238 Pa. 301, 86 Atl. 203; Silver v. 
Bush, 213 Pa. 195, 62 Atl. 832; Dunham v. Kirkpatrick, 101 Pa. 
36, 47 Am. Rep. 696; Detlor vr Holland, 57 Ohio St. 492, 40 
L.R.A. 266, 49 N. E. 690. And the same in Kentucky. McKin- 
ney's Heirs v. Central Ky., etc., Gas Co., 134 Ky. 239, 20 Ann. 
('as. 934, 120 S. W. 314, but this Kentucky case is virtually 
overruled in Kentucky Diamond Min., etc., Co. v. Kentucky, etc., 
Co., 141 Ky. 97, Aim. Cas. 1912C 417, 132 S. W. 397, and Scott 

V. LttWS (Ky.; 215 S. W. 81. 

8 



MINERAL CHARACTER 9 

While in Pennsylvania oil and gas seem not to be covered by 
words of general exception, they are constantly recognized as 
minerals on accounting between cotenants and in many other 
cases. Mcintosh v. Ropp, 233 Pa. 497, 82 Atl. 949. Even under 
an Act passed before oil value or existence was known. Thomp- 
son v. Noble, 3 Pittsburgh 201, 11 M. R. 137. 

Oil is a mineral and therefore real estate and a guardian must 
treat it as such. Stoughton's Appeal, 88 Pa. St. 198. 

Gas and oil not reduced to possession are real estate and be- 
long to the owners of the fee. Richmond Natural Gas Co. v. 
Davenport, 37 Ind. App 25, 76 N. E. 525; Preston v. White, 57 
W. Va. 278, 50 S. E. 236; Canon v. Scott (Tex. Civ.) 217 S. W. 
429. They are included under the word "land/' Kennedy v. 
Ohio Fuel Co. (W. Va.) 101 S. E. 159. Oil and gas are land, a 
part of the soil in which they are found. Haskell v. Sutton, 53 
W. Va. 206, 44 S. E. 533. 

No definition of the word minerals will apply to all cases : the 
Court must consider the position of the parties as well as the 
wording of the paper. Rock House Fork Land Co. v. Raleigh 
Brick, etc., Co. ( W. Va.) 97 S. E. 684. 

The subject is necessarily associated with the conveyance or 
reservation of minerals covered in later chapters. 

The Question Whether an Oil Well Is a Mine 

or drilling for or pumping oil is mining, has come up indirectly 
in several cases. 

In Kreps v. Brady, 133 Pac. 216, there arose the second of 
these queries as to whether drilling an oil well was mining. The 
Oklahoma Constitution provided that the fellow servant law 
should not apply to mining. If drilling was mining the defend- 
ant could not plead the negligence of a fellow servant. 

The Court in a very able opinion held that it was not mining. 
The reasoning was based on the dictionarj' definitions of mines 
and mining and on the fact that the Oklahoma mining statutes 
did not refer to oil wells. But they did not consider the point 
that drilling for oil is a new industry, a mode of getting mineral 
not known until very recently, long after such definitions had 
become stereotyped. 



10 MORRISON'S OIL RIGHTS 

The Constitution of Louisiana exempted from taxation for 
a certain period, "property employed in mining operations." 
The Court held that such phrase did not cover an oil well and 
that an oil well was not a mine, citing; several definitions of 
that word and cognate terms. Its conclusion was that oil was 
not a mineral covered by the noun and adjective "mineral op- 
erations." 

In neither of these cases is any reference made to the well 
known fact that the law adapts itself to changed conditions and 
the meaning of words also changes to meet such changes of con- 
ditions. Not only is drilling for oil a modern industry but there 
are other innovations. In the Frash process sulphur is mined 
by letting down hot water in a tube, bringing back the saturated 
water and evaporating the sulphur on the surface. 

There is more than one mine in the United States where cop- 
per and nitre are produced by evaporation of the water which 
holds such minerals in solution. The. Court adapts the law to 
the conditions of a new country. Findlay v. Smith, 6 Munf. 
134, 13 M. R. 182. 

On the other hand the reservation in a deed of the right to 
mine was held broad enough to allow the boring for oil. Luse 
v. Boatman, 217 S. W. 1096; Luse v. Parmer, 221 S. W. 1031. 

None of these decisions reach the point where it can be said 
that the question is definitely settled and it admits of far more 
thorough argument than can be found in the reports of the 
cases cited. 



CHAPTER 3. 

OWNERSHIP. 



Land Owned in Fee. 



That the owner of the fee simple title, owns the oil and gas 
under his land can neither be doubted nor questioned. The only 
serious qualification to this is the doctrine of ferae naturae, based 
on the fugacious character of these minerals as elsewhere dis- 
cussed. 

Even if the land has been patented under some sort of non- 
mineral entry, the subsequent discovery of mineral value does 
not divest his ownership, barring' certain cases where knowledge 
or anticipation of such value is chargeable to him. 

Ocean, Lakes and Rivers. 

Ownership under the seashore, lakes and rivers remains in 
the original sovereign unless it has passed by grant or Legisla- 
tive Act, or has been indirectly transferred as a riparian right. 

Sea Shore. 

The United States seems never to have owned or claimed min- 
erals under the sea. They belong to the Territory or State. 

This question seems to be definitely settled by the case of 
Shively v. Bowlby, 152 U. S. 1, 38 L. ed. 331, 14 Sup. Ct. 548. 
The State not only owns the minerals under the sea, but between 
high and low tide. To the same effect is Pennsylvania R. Co. v. 
New York, etc., R. R. Co., 23 N. J. Eq. 157. 

The owner to the shore line has right of access to the sea, and 
what are known as littoral rights. In San Francisco Sav. Union 
v. R..G. R. Petroleum, etc., Co., 144 Cal. 134, 103 Am. St, Rep. 
72, 1 Ann. Cas. 182, 66 L.R.A. 242, 77 Pac. 823, the erection 

11 



12 MORRISON'S OIL BIGHTS 

of an oil derrick under tide water on his front was enjoined in 
favor of such littoral proprietor. 

Tide lands are such public lands as are allowed to be let for 
oil and gas leases. State v. Savidge, (Wash.) 188 Pac. 923. 

River Beds and Lakes. 

The State owns the minerals under the bed of navigable rivers. 
The riparian owners hold title to the minerals under non-navi- 
gable rivers as at common law. The whole subject is learnedly 
discussed in U. S. v. Brewer Elliott Oil Co., 249 Fed. 609 ; and in 
Malcomson v. Wappoo Mills, 86 Fed. 192. The beds of navigable 
streams and lakes never belonged to the United States but be- 
long to the State itself, disposable of by the legislature. State v. 

Capdeville, 146 La. , 83 So. 421. In Wemple v. Eastham, 

144 La. 957, 81 So. 438, air injunction issued to protect the lessee 
from the State, of oil ground under river-bed. 

The land office rulings conform to these decisions. The title 
to minerals under meandered lakes is not in the U. S. Under 
a navigable lake it is in the State and under a non-navigable 
body of water, it belongs to the riparian owners. .In re Sham- 
tvay, 47 L. D. 71 ; In re Stroehle, 47 L. D. 72. And they allow a 
mining claim to be located on the bed of a non-navigable river. 
Cataract Gold Min. Co., 43 L. D. 248. 

Three mining companies owned all the land surrounding a 
small lake of irregular shape underlaid with iron ore. By agree- 
ment they drained the lake. Most interesting questions arose as 
to the ownership of the bed of the lake, but the court held the 
matter settled as a case of boundary conflict adjusted by agree- 
ment. Pittsburgh & L. A. Iron Co. v. Lake Superior Iron Co., 
118 Mich. 109, 76 N. W. 395. 

In the controversy between the States of Oklahoma and Texas 
concerning valuable oil ground in. the bed of the Red river, the 
United States was allowed to become an intervenor, and receiver 
was appointed April 1, 1920. Oklahoma v. Texas, 40 Sup. 
Ct. Rep. 353. 

The bed of a navigable river was held not open to oil pros- 
pectors under the Texas Statute conferring such prospecting 
rights over the public lands and that the survey of such river 



OWNERSHIP 13 

bed by a county surveyor did not make such ground, surveyed 
land, under the Act of 1917. Landry v. Bobison, 219 S. W. 819. 
A Kansas Statute authorizing the taking of sand from the 
bed of a non-navigable river was upheld in Wear v. Kansas, 245 
U. 8. 154. 

Under Highways. 

it belonged to the original owner of the tract over which the 
road was dedicated and when the easement is abandoned, it usu- 
ally reverts to such grantor or to the adjoining landowners and 
while in existence may be worked by such adjoining owners 
unless otherwise governed by local statute. 

The coal under its streets belongs to the city. Union Coal Co. 
v. City of La Salle, 136 111. 119, 12 L.R.A. 326, 26 N. E. 506; 
City of Des Moines v. Hall, 24 Iowa 234; Hawesville Trustees v. 
Hawes Heirs, 6 Bush (Ky.) 232. 

Where the ownership of the surface and subsoil is separate or 
when the highway has only an easement, it would seem that the 
respective rights could readily be adjusted under the maxim sie 
ate re tuo ; thus it was decided that a mining shaft on the surface 
of a public street was a nuisance which the city could not license 
in Friend v. Porter, 50 Mo. App. 89. But in Zinc Co. v. La 
Salle, 117 111. 411, 2 N. E. 406, 8 N. E. 81, the rights of the 
city were so strongly asserted that the adjoining owner was not 
allowed to drive a crosscut under the street. 

Where the grant or condemnation is only of the right of way, 
it gives the city no title to the mineral. Smith v. Rome, 19 Ga. 
89, 63 Am. Dec. 298, 7 M. R. 306; Smith v. Holloway, 124 Ind. 
329, 24 N. E. 886; Evans v. Haefner, 29 Mo. 141; Robert v. Sad- 
ler, 104 N. Y. 229, 58 Am. Rep. 498, 10 N. E. 428; Perley v. 
Chandler, 6 Mass. 454, 4 Am. Dec. 159. The claim of title to 
the minerals asserted by the city under the Colorado Statute 
was denied in City of Leadville v. Bohn Min. Co., 37 Colo. 248, 
11 Ann. Cas. 443, 8 L.R.A. (N.S.) 422, 86 Pac. 1038. 

Where the dedicator reserved the minerals and afterwards con- 
veyed the lots, the grantee of the lots took title to the minerals. 
Snoddy v. Bolen, 122 Mo. 479, 24 L.R.A. 507, 24 S. W. 142, 25 
S. W. 932. The minerals being reserved by the dedicator, the 



14 MORRISON'S OIL RIGHTS 

city does not own the minerals. City of Du Buque v. Benson, 
23 Iowa 248. 

When land is covered by right of way, the minerals belong 
to the adjoining owner and a lease of them must respect the sur- 
face rights of the easement. The lessee cannot disturb the sur- 
face possession of the railroad, but can enjoin the sinking of a 
gas well. Consumers Gas Trust Co. v. American, etc., Glass Co., 
162 Ind. 393, 68 N. E. 1020. 



CHAPTER 4. 

CONVEYANCE. 

Any ordinary deed of land without reservation conveys as 
everywhere ruled all the minerals under the land. Almost the 
only exception to this is where under Ancient English Law, the 
royal metals were supposed to remain vested in the Crown. In 
Colonial Grants those metals were sometimes reserved to the 
proprietors. 

But the context of the granting or reserving clause of the con- 
veyance may be such as to compel a construction that oil is ex- 
cluded. Horse Creek, etc., Mm. Co. v. Midkiff, 81 W. Va. 616, 
95 S. E. 26; Right of Way Oil Co. v. Gladys City Oil, etc., Co., 
106 Tex. 94, 51 L.R.A.(N.S.) 268, 157 S. W. 737. 

Anomolous conveyances are met with which require construc- 
tion. Minerals have been conveyed by the name of the mineral, 
and the deed was held to be the conveyance of an interest in 
land. Thomason v. Upshur County (Tex. Civ.) 211 S. W. 325, 
and a sale by deed of what the grantor had not already sold was 
held to carry mineral rights reserved to him in a prior contract. 
Morse v. Smyth, 255 Fed. 981. 

A deed conveying all mineral rights and the right to search 
for all undiscovered minerals was held a deed of the minerals 
and not a mere license to explore and that it carried oil and gas. 
Scott v. Laws (Ky. App.) 215 S. W. 81. 

In a very late case the authorities are reviewed and oil is 
held to be mineral without regard to the question whether it was 
known as a mineral at the time of the reservation. And it was 
further held that the verb "to mine" was broad enough to cover 
the usual means by which oil is recovered. Luse v. Boatman 
(Tex. Civ.) 217 S. W. 1096. 

Where a deed reserved the minerals but there was a subse- 

15 



16 MORRISON'S OIL RIGHTS 

quent deed from the same grantor to the same grantee the origi- 
nal reservation was killed. Luse v. Penn (Civ. App. Tex.) 220 
S. W. 303. 

In Clay v. Palmer (Nebr.) 177 N. W. 840, is found a contract 
or informal lease of the waters of a lake to extract potash. 

Description. 

The description of oil land conveyed or leased need not dif- 
fer from the ordinary terms used. The deed of the land carries 
whatever lies under the soil without mention of oil or gas or any 
reference to minerals. But where the surface and the mineral 
rights are severed or where particular tracts are cut out, a careless 
wording often leads to unnecessary litigation. 

Diamond Plate Glass Co. v. Tennell, 22 Ind. App. 132, 52 N 
E. 168, is a case which treats of indefinite description, as to how 
far it may be determined by insertion of words omitted and when 
it is incurable. A tract 20 feet square was held to be so de- 
scribed that it couid not be identified. A peculiar description 
of 20 foot square lots was upheld, in Simpson v. Pittsburgh P. 
G. Co., 28 Ind. App. 343, 62 N. E. 753. 

An exception of 10 acres around a certain oil well was held 
too indefinite to sustain a decree. Jones v. Mount, 30 Ind. App. 
59, 63 N. E. 798. 

A sweeping assignment of oil leases on land "immediately sur- 
rounding" Mound City, Kansas covers a lease more than a half 
mile distant. Rhodes v. Mound City Gas, etc., Co., 80 Kan. 762, 
104 Pac. 851. 

As in ordinary deeds the grant, of mining rights by reference 
to ad joiners and their grantors may be sufficient. Virginia Iron, 
etc., Co. v. Combs (Ky. App.) 216 S. W. 846. 

A deed to school directors for land "for school purposes only" 
was held to convey oil rights. This construction was on the 
proposition that expression of the mere use for which land was 
intended, did not cut down the fee simple otherwise conveyed by 
the dord. T. W. I'll III ins Gas & Oil Co. v. Lingt njvllcr, 262 Pa, 
500, L05 All. 888, 



CONVEYANCE 17 

Deed and Lease Combined. 

A document occasionally appears which is a combination of 
deed and lease. In Feather v. Baird (W. Va.) 102 S. E. 294, a 
West Virginia case, the first party sold and conveyed a piece of 
land for a consideration and in addition reserved a royalty of one 
cent per ton on all coal as it should be mined. The Court con- 
strued the royalty as an additional consideration for the sale 
and not as converting the deed into a lease. This made it similar 
to what is called in old conveyancing a ground rent. 
M. O. R.— 2. 



CHAPTER 5. 

SEVERANCE, EXCEPTION, RESERVATION. 

That the mineral estate may be severed from the surface es- 
tate has been settled in England by many early decisions and 
has apparently never been disputed in this country. Rcnve v. 
Brenton, 8 B. & C. 737. 

Such severance is often created by deed direct, granting the 
mineral rights alone, but more usually by exception or reserva- 
tion in the conveyance. 

The Two Estates Not Hostile. 

Where such separation of titles occurs sundry distinctions and 
incidents follow, for instance, that each separate estate must 
recognize the other, the mineral owner having the right of entry 
to get at his underground values and the mines being bound to 
furnish at least vertical support to the surface and that posses- 
sion of the surface does not ripen into title against the mineral 
owner, nor vice versa. 

When oil and gas are severed by reservation or exception they 
are a corporeal property separate from the surface, and a subse- 
quent conveyance of the land carries the mineral title which had 
been held by such reservation. Preston v. White, 57 W. Va. 278, 
50 S. E. 236. 

When minerals are not intended to pass, they are cut out by a 
reservation or by an exception which words though somewhat 
different in meaning are often used interchangeably. Moore v. 
Griffin, 72 Kan. 164, 4 L.R.A.(N.S.) 477, 83 Pac. 395; Preston 
v. White, supra. 

Adverse Possession. 

Where the surface and mineral have been severed, nonuser 
by the mineral owner never gives title to the surface owner by ad- 

18 



SEVERANCE AND EXCEPTION 19 

verse possession. Scott v. Laws (Ky. App.) 215 S. W. 81. Pos- 
session by the surface owner, exercising surface incidents is not 
adverse to the mineral owner. Murray v. Allred, 100 Tenn. 100, 
66 Am. St. Rep. 740, 39 L.R.A. 249, 43 S. W. 355, 19 M. R. 169. 

Drilling through Coal Vein. 

The owner of the surface who has conveyed the coal has the 
right to bore through the coal vein to find oil — at least equity 
will not enjoin his drilling. Chartiers Block Coal Co. v. Mellon, 
152 Pa. St. 286, 34 Am. St. Rep. 645, 18 L.R.A. 702, 25 Atl. 597 ; 
Pennsylvania Central Brewing Co. v. Lehigh Valley Coal Co., 
250 Pa. St. 300, 95 Atl. 471. 

Other Incidents. 

After severance, the separate owners are not tenants in com- 
mon. Virginia Coal & Iron Co. v. Kelly, 93 Va. 332, 24 S. E. 
1020, 18 M. R. 395. And there is no privity of estate between 
them. Hutchinson v. Kline, 199 Pa. 564, 49 Atl. 312. 

The right to support due to the mine owner and his right to 
use the surface for access to his mine are stated in Mining Rights 
15th Ed. P. 300. 

Severance in Late U. S. Patents. 

The policy of the government for more than one hundred 
years and in fact until very recently has been to pass both sur- 
face and minerals to the one grantee, sometimes requiring the 
mineral character to be determined before patent and sometimes, 
as in the reservation of known mines out of placers, leaving it 
for future determination. But under the legislation of 1920 
and for some time before, especially concerning coal lands, the 
government grants the mineral and surface title separate and 
under the leasing act provides in instances for separate leases 
of minerals and surface, a departure from precedent which will 
lead of course to controversy and litigation, but the wisdom or 
lack of wisdom in such cases, it is not the province of this book 
to discuss. 



CHAPTER 6. 

FUGACIOUS CHARACTER— FERAE NATURAE. 

In a case in Pennsylvania considering the .fugacious nature of 
oil and gas, they were compared to animals ferae naturae, the 
property in which does not become absolute until they are re- 
duced to possession. Westmoreland, etc-., -Natural Gas Co. v. 
De Witt, 130 Pa. 235, 249, 5 L.R.A. 731, 18 Atl. 724. 

It cites Brown v. Vandergrift, 80 Pa. 142, but that case makes 
mere incidental reference to the wandering existence of oil. The 
point is hinted at as early as 1867 in. Dark v. Johnston, 55 Pa. 
164, 93 Am. Dec. 732, 9 M. R, 283. 

This fanciful but forcible illustration leads to the proposition 
that the proprietor or lessee of the land does not become owner 
of these minerals until they are reduced to possession by sever- 
ance. 

This precedent has been followed in numberless cases until it 
has become a rule of property and it is entirely too late to ques- 
tion it. We have nevertheless never yielded pur assent to the 
logic of the analogy or the distinction which it forces into the 
]aw. It has led in its application, to novel if not startling de- 
cisions. The whole subject of drainage and protection is affected 
by it as well as many questions of pleading and practice. 

A somewhat analogous case is where the law of gravitation 
brings down rocks or ore to a lower level. Such an instance ap- 
pears in Dearden v. Evans, 5 M. & W. 11, 151 Eng. Reprint, 5, 
where stones had come down and rested on land below and in 
Brown v. Forty-nine, etc., Quartz M. Co., 15 Cal. 152, 76 Am. 
Dec. 468, 9 M. R. 600 where float gold was traced from the ledge 
some distil nee down, but neither of these cases decide at what 
point of time the change of ownership took place. 

Both of these illustrations are remote; but where fancies are 
adopted as facts strange consequences sometimes follow to shake 
the foundations upon which the rights of property should stand. 

20 



FUGACIOUS CHARACTER 21 

Analogy between Oil and Game. 

Carrying out the alleged logic of the illustration, likening oil 
and gas to game and fish, comes a line of decisions; that the 
tenant has no estate in the oil until it is tapped. McNish v. 
Stone, 17 M. R, 22, 152 Pa. 457, note; Venture Oil Co. v. Fretts, 
152 Pa. 451, 25 Atl. 732, 17 M. R. 543 ; Florence Oil & Refining 
Co. v. Orman, 19 Colo. App. 79, 73 Pac. 628; Kolachny v. Gal- 
breath, 26 Okla. 772, 38 L.R.A.(N.S.) 451, 110 Pac. 902; Beards- 
ley v. Kansas N. Gas Co., 78 Kan. 571, 96 Pac. 859; Kelly v. 
Keys, 213 Pa. 295, 110 Am. St. 'Rep. 547, 62 Atl. 911; Priddy 
v. Thompson, 204 Fed. 955, 123 C. C. A. 277; Lindlay v. Bay- 
dure, 239 Fed. 928. 

That the analogy between oil and gas on the one side, and 
fish and game on the other side of the comparison, is not com- 
plete, is pointed out in the opinion of the Court in Ohio Oil Co. 
v. Indiana, 111 U. S. 190. The State may not only regulate the 
taking of fish and game but it may wholly prohibit the taking. 
It may regulate the production of oil and gas but it cannot for- 
bid their extraction. 

The migratory character of drifting sand does not change 
its character while at rest upon the river bed. Wear v. Kansas, 
245 U. S. 154. 

This doctrine of ferae naturae is referred to in many of the 
opinions and perhaps Rich v. Doneghey (Okla.) 177 Pac. 86, 
stater; it as fully and as learnedly as any other. 

Some of the cases hold that the lessee has no title till the oil 
is reduced to personal property. Others that he must have 
drilled into the oil stratum. It is only an abstract question un- 
til you come to the distinctions between real and personal prop- 
erty matters of taxation and forms of action, forms of action 
under the codes being abolished in name only. More especially 
it leads to questions of whether lease or license and to the in- 
tangible lines that purport to define the boundaries between 
corporeal and incorporeal hereditiments. 

This alleged distinction is expressed in various forms : 

"Oil and gas while in the earth unlike solid minerals are not 
the subject of ownership distinct from the soil." Frank Oil Co. 
v. Bell f view Gas, etc., Co., 29 Okla. 719, 43 L.R,A.(N.S.) 487, 



22 MORRISONS 0]L RIGHTS 

119 Pac. 260; Kolachny vt Galbrcath, 26 Okla. 772, 38 L.R.A. 
(N.S.) 451, 110 Pac. 902. 

The lessees of oil and gas are not the owners of these minerals 
but only have the right to search for them. Campbell v. Smith, 
180 Ind. 159, 101 N. E. 89 ; Louisville Gas Co. v. Kentucky Heat- 
ing Co., 132 Ky. 435, 111 S. W. 374; Gillespie v. Fulton Oil, etc., 
Co., 239 111. 326, 88 N. E. 192; Foe v. Vlrey, 233 111. 56, 84 N. E. 
46. 

And in other cases allusion is made to the obvious resemblance 
to other fluid substances, but without suggestion in practical 
terms as to where the resemblance ends and the difference begins. 

"Oil is a fluid like water; it is not the subject of property ex- 
cept while in actual occupancy." Dark v. Johnston, 55 Pa. 164, 
93 Am. Dec. 732, 9 M. R. 283. Oil is governed to some extent 
by the analogous case of other liquids, salt and mineral waters. 
Wagner v. Mallory, 169 N. Y. 501, 62 N. E. 584, 22 M. R, 42; 
Ohio Oil Co. v. Indiana, 177 U. S. 190, 44 L. ed. 729, 20 Sup. Ct. 
576, 20 M. R. 466; Manufacturers Gas & L. Co. v. Indiana N. 
G., etc., Co., 155 Ind. 461, 50 L.R.A. 768, 57 N. E. 912, 20 M. R. 
672. 

Oil must be Reduced to Possession. 

A corporeal interest in oil and gas, that is, a title to the same, 
cannot be acquired without the reduction of them first, to per- 
sonal property. Heller v. Bailey, 28 Ind. App. 555, 63 N. E. 
490. No title in the oil is vested until reduced to possession. 
Friddy v. Thompson, 204 Fed. 955, 123 C. C. A. 277. 

The fugacious character of oil and gas is considered as to its 
effect on the construction of leases in New American Oil Co. 
v. Troyer, 166 Ind. 402, 76 N. E. 253, 77 N. E. 739. It is 
an extreme holding to the effect that oil and gas leases so called 
are a class of their own, that they do not come within the Land- 
lord and Tenant Statutes and that oil and gas are not the sub- 
jects of sale or lease until reduced to possession. 

It is cited and materially qualified in Bryson v. Crown Oil Co., 
1ST) Ind. 156, 112 N. E. 1, with the intimation that the fugacious 
character of oil and gas should be discarded when they have no 
bearing on the issues at bar. 



FUGACIOUS CHARACTER 23 

It may be remarked here that this fugacious character of oil 
and gas is frequently referred to and commented on by the 
judges through a pardonable vanity to display their learning 
where it has very little. relation to the issue before the Court. 

One of the unforeseen conclusions from this analogy, based on 
the proposition that a lessee cannot sue in ejectment until he has 
been ousted from possession — is that a lessee who has not tapped 
the oil cannot maintain ejectment against a party taking the oil. 
Kelly v. Keys, 213 Pa. 295, 110 Am. St. Rep. 547, 62 Atl. 911; 
Kolachny v. Galbreath, 26 Okla. 772, 38 L.R.A.(N.S.) 451, 110 
Pac. 902; Brookshire Oil Co. v. Casmalia Ranch Oil, etc., Co., 
156 Cal. 211, 103 Pac. 927; Priddy .v. Thompson, 204 Fed. 955, 
123 C. C. A. 277; Frank Oil Co. v. Belleview Gas, etc., Co., 29 
Okla. 719, 43 L.R.A.(N.S.) 487, 119 Pac. 260. 

In Kline v. Guaranty Oil Co., 167 Cal. 476, 140 Pac. 1, a dis- 
tinction is made on the mere wording of the lease, the wording 
being a demise of the land itself and not of the mere right to 
explore. But thousands of oil leases are worded in the same 
w T ay and this technical distinction is seldom made. 

The general proposition is concisely stated in Brown v. $pil- 
man, 155 U. S. 665, 670, 39 L. ed. 304, 15 Sup. Ct. 245 and in 
Lanyon Zinc Co. v. Freeman, 68 Kan. 691, 1 Ann. Cas. 403, 75 
Pac. 955, deciding that oil and gas are minerals and belong to 
the owner of the land so long as they are on it or subject to the 
owner's control : that "when they escape and go into other lands 
or come under another's control, the title of the former owner is 
gone." 

Drainage and protection from drainage bring up the fugacious 
incidents of liquids and gases, but we see no other line of cases 
where these incidents ought to challenge or change the common 
law. We do not see why, when the oil is concededly under his 
land, the lessee should be forbidden to protect his property 
against one who takes his oil or threatens to take it, by any form 
of action the same as is allowed to the owner in fee. 



CHAPTER 7. 

JUDICIAL NOTICE. 

Judicial notice is taken everywhere of facts of universal or 
even general knowledge, of history, of political events and geo- 
graphic localities and as to incidents peculiar to oil and gas it 
has been decided: 

Manner of Mining — Hazardous. 

That courts will take judicial notice: That oil and gas are 
mined by means of deep drilled wells. Kemp v. Barr Gas Co., 
103 Kan. 595, 175 Pac. 988. That pay gas and oil do not exist in 
every part of the field and that putting down a well is the only 
final test, Consumers Gas Trust Co. v. Littler, 162 Ind. 320, 70 
N. E. 363. That oil mining is a hazardous business involving 
large expenditure and also that the usual royalty is one-eighth. 
Garrett v. South Perm Oil Co., 66 W. Va. 587, 66 S. E. 741. 

That natural gas unlike oil, cannot be stored for a market. 
Eastern Oil Co. v. Coulehan, 65 W. Ya. 531, 64 S. E. 836. That 
natural gas is a necessity. Jamiesbn v, Indiana N. Gas, etc., Co., 
128 Ind. 555, 12 L.R.A. 652, 28 N. E. 76. 

Inflammable Character. 

Courts take judicial notice of the inflammable, dangerous and 
explosive traits of natural gas. Jamiesbn v. Indiana N. Gas, etc., 
Co., supra; Indiana Natural Gas, etc., Co. v. Jones, 14 Ind. App. 
55, 42 N. E. 487; Benedict v. Columbus Const. Co., 49 N. J. Eq. 
23, 23 Atl. 485; Alexandria Mining, etc., Co. v. Irish, 16 Ind. 
App. 534, 44 N. E. 680; State v. Moore, 27 Ind. App. 83, 60 X. 
E. ^7), 21 M. R. 401; Hashman v. Wyandotte Gas Co,, 83 Kan. 
328, 111 Pin-. 168. The same as to gasoline. Whittemore v. Bax- 
ter Laundry Co., 181 Mich. 564, Ann. Cas. 1916C, 818, 52 L.K.A. 
(N.S.) 930, 148 N. \V. 437. And that coal oil is inflammable. 

24 



JUDICIAL NOTICE 25 

State v. Hayes, 78 Mo. 307; Texas & N. 0. R. Co. v. Bellar, 51 
Tex. Civ. 154, 112 S. W. 323. 

That gas alone or mixed with kerosene is highly explosive. 
McLawson v. Paragon Ref. Co., 198 Mich. 222, 164 N. W. 668. 
Of the qualities of artificial gas, kerosene, gunpowder and dyna- 
mite. Schmidt v. Union Oil Co., 27 Cal. App. 366, 149 Pac. 
1014. That abandoned coal mines generate gas. Cheek v. Mis- 
souri K. & T. Ry. Co., S9 Kan. 247, 131 Pac. 617. 

Of the noise and odor from a gas or oil well and of everything* 
of common experience to everybody in the locality. Brown v. 
Spilman, 155 U. S. 665, 39 L. ed. 304, 15 Sup. Ct. 245. 

Nonjudicial Notice. 

They have refused to take judicial notice on the following 
points : 

An oil lease covered oil "or other valuable volatile substances." 
The Court declined to decide as matter of law that natural gas 
was or was not a volatile substance. Ford v. Buchanan, 111 Pa. 
31, 2 Atl. 339. 

The Court refused to hold that kerosene was a "burning fluid 
or chemical oil" in an insurance case. Mark v. National Fire Ins. 
Co., 24 Hun (N. Y.) 565, affirmed 91 N. Y. 663. Or that kerosene 
is a refined coal or earth oil. Bennett v. North British, etc., Ins. 
Co., 8 Daly (N. Y.) 471. The Court will not take judicial notice 
that kerosene oil (standardized by statute) is explosive. Wood 
v. North Western Ins. Co., 46 N. Y. 421. Nor that coal dust 
is explosive. Cherokee, etc., Min. Co. v. Limb, 4Ti Kan. 469, 28 
Pac. 181. 

The Court does not judicially know that enough natural gas 
will not seep from the main in the street to the house to cause an 
explosion. Mississinewa Min. Co. v. Patton, 129 Ind. 472, 28 
Am. St. Rep. 203, 28 N. E. 1113. 



CHAPTER 8. 

OIL AND GAS. OIL WELLS AND GAS WELLS. 
DISTINCTION. 

Leases have been granted to search for salt water and oil has 
been found ; to seek for oil but gas was found ; and the two 
minerals have been found together, one workable and 'the other 
not, or both workable. Royalty is the usual reserve for the oil 
and money rent for the gas because of the difficulty of measur- 
ing it and the impossibility in most cases of delivering it in 
kind. This has led to litigation as to what is an oil well and 
what is a gas well. It is impossible to cover the topic of this 
chapter confusing in its very nature, except by referring to the 
decisions many of which will be found to be only a judicial ef- 
fort to pass justly upon points, little aided by precedent and 
where no plain proposition of law or of natural justice presents 
any easy solution of the difficulties. 

The courts have generally held that whatever the lessee found 
was his property as a mere incident to the principal purpose of 
the lease, but they do not harmonize, nor do they decide any one 
principle decisive of the right in such cases. 

In construing an oil and gas lease, which is ambiguous, the 
Court will look to the intent of the parties, the surrounding 
circumstances, and the condition of the business at that time. 
Twin Hills Gasoline Co. v. Bradford Oil Corp., 264 Fed. 440. 

Oil Found in Salt Well. 

In Kiev v. Peterson, 41 Pa. St. 357 the defendant was the lessee 
of the premises as a salt well. Petroleum was found. The brine 
could not be utilized until the oil had been separated. A ma- 
jority of the court held that the oil belonged to the lessee. 
Thompson, J., in a separate opinion held that the oil was the 
proper! v of the lessor and that while trover would not lie for it, 

26 



OIL AND GAS 27 

the defendant should be held on an accounting. In Kitchen v. 
Smith, 101 Pa. 452, where gas was found under an oil lease the 
court intimated that the lessee had no right to sell it, citing the 
Kiel* case with disapproval. 

Gas in Well Sunk for Oil. 

Where gas is found when oil was expected, it is in equity the 
same as finding the oil, in so far as extensions are predicated 
upon such condition. Hennessy v. Junction Oil & Gas Co. 
(Okla.) 182 Pac. 666. 

The lease called for a royalty on the oil and a rental on each 
gas well. The court held that no rental was due where gas was 
a mere accident to the oil production altho it was utilized to 
operate the power. Prichard v. Freeland Oil Co., 75 W. Va. 450, 
L.R.A.1915D 1186, 84 S. E. 945. But on a second appeal the 
commercial value of the gas was proved and the lessee was held 
for the rental. 80 W. Va. 787, 93 S. E. 871. This case defines 
a gas well as one of commercial value, not every well producing 
gas being in law a gas well. 

In Indiana Natural Gas, etc., Co. v. Wilhehn, 44 Ind. App. 
100, 86 N. E. 86, the lease called for ^ royalty on the oil and 
$200 rent for every gas well furnishing gas enough to market. 
The well produced both oil and gas. It was held that the cost 
of the well was not to be considered in estimating whether gas 
existed in marketable quantities, but the cost of marketing the 
oil was to be considered. ' 

In Twin Hills Gasoline Co. v. Bradford Oil Corp., 264 Fed. 
440, is a definition of "casing head gas" finding it to be a com- 
ponent part of oil produced from wet gas and its presence does 
not make the well a gas well so as to -hold the lessee for rent 
reserved on gas. 

Gas Rent when Not Demandable. 

Lessee was to pay gas rent if gas found in quantity sufficient 
to justify marketing. It was necessary to remove the gas to get 
the oil — this was not marketing the gas, altho it was sold. 
Sheivalter v. Hamilton Oil Co., 28 Ind. App. 312, 62 N. E. 708. 



28 MORRISON'S OIL RIGHTS 

A lessee under an oil and gas lease was to pay an additional 
rent when oil was produced in pipe line in paying quantity; only 
gas was found and the defendant was held not liable for the 
additional rent. Ball v. Freeman, 77 W. Va. 156, 87 S. E. 91. 

When Impossible to Save Both. 

Where the lessees attempted by contract to separate the owner- 
ship of the oil product and the gas product and the defendant, 
holding the oil rights, allowed the gas to escape, contending that 
he could not otherwise secure the oil, an injunction to the plain- 
tiff was denied. Arnold v. Garnett Light, etc., Co., 103 Kan. 
166, 172 Pac. 1012. 

Gas Found when Oil Contracted For. 

There is a Louisiana case and a Pennsylvania ease which illus- 
trate the unusual propositions w T hich may arise under a search 
for oil where gas only is found. In the Louisiana case, the lessee 
after doing certain work had the right to do further prospecting 
for oil. The Court in a very technical opinion, denied that he 
could prospect for gas. Cooke v. Gulf Refining Co., 127 La. 592, 
53 So. 874. Provosty, J., dissented. In the Pennsylvania case 
the terms of the lease limited it to "petroleum, rock or carbon 
oil" and for no "other purpose." Gas but not oil was found and 
the lessees were forfeited out. The Court held that gas and oil 
w r ere not synonymous terms and that the lessees could not legally 
get refund of the cost of the gas well which they had drilled and 
the lessor had taken away. Truby v. Palmer (Pa.) 6 Atl. 74; 
Palmer v. Truly, 136 Pa. 556, 20 Atl. 516. There was an equity 
to the lessees in both these cases, but each failed to make good 
his contention. 

The Truby lease was limited to oil only. In sinking, gas in 
quantity was struck but no oil. The lessee conceding such fact, 
a nonliteral compliance with the lease, claimed that the lessor 
should not be allowed to take the well and make a profit from 
the gas, without paying the cost of sinking. 

The case involves two points : 

1. That the finding of the gas was an unavoidable incident in 
carrying out the express or implied agreement to search for oil. 



OIL AXD GAS 29 

2. The question of identity in fact without identity in form. 
It involves not the celebrated ecclesiastical controversy between 
the meaning of "same" and "similar" but the meaning of "same" 
in different presentations. Practically every element has its 
three mechanical forms of solid, liquid and gas. Further the 
same element may have many shapes. Steam, vapor, snow, hail, 
ice, mist, and dew are only water in the infinite variety of nature. 
As to oil it has been judicially decided that "whilst oil and gas 
are different in character they are yet one because they are 
unitedly held in the place of deposit." Ohio Oil Co. v. Indiana, 
111 U. S. 190. 

The Court in the Truby case says: "It would be a clear per- 
version of language to hold that gas and oil are synonymous 
terms." Nevertheless it is no more satisfactory to the legal pro- 
fession than to the disappointed suitor to kill the equity of a case 
by the emphatic expression of a truth which is a truth in name 
only. Money was expended in good faith in the hope of gain 
to both. That expenditure brought wealth to one and loss to 
the other the wealth of one being predicated on the other's loss 
and we are bold to say that justice was not done. 

Head Gas. 

In a case involving this term it was held error to allow, evi- 
dence of its meaning when the business was new and usage had 
not become notorious. Bubb v. Parker, etc., Oil Co., 252 Pa. St. 
26. 97 Atl. 114. 

Gas from Oil Well. 

In a lease calling for a rent if gas was found in sufficient 
quantities to utilize, the lessee was not allowed to prove that 
the word "gas" meant gas from a gas well and not gas from an 
oil well. Burton v. Forest Oil Co., 204 Pa. 349, 54 Atl. 266, 22 
M. R. 507. 

Injury from Water. 

The owner of a well sunk for gas who strikes salt water which 
ruins the fresh water wells in the neighborhood is liable for dam- 



30 MORRISON'S OIL RIGHTS 

ages, when by casing' at a small cost, he could have prevented 
such injury. Collins v. Ch artier s Valley Gas Co., 131 Pa. 143, 17 
Am. St. Rep. 791, 6 L.R.A. 280, 18 Atl. 1012. 

The effect of water to kill the oil yield of the well is inci- 
dentally referred to in Gird v. California Oil Co., 60 Fed. 531, 
Id M. R, 45. 

Natural Gas Is Not Heat. 

It is a fuel. Emerson v. Com., 108 Pa. St. Ill, 126. This ex- 
pression is used in the construction of an Act which was held lim- 
ited to corporations furnishing a "manufactured product" which 
natural gas is not. 

Gas Used on Premises. 

An oil and gas lease called for a fixed rent for each well 
while the gas was "being used off the premises. The Court held 
that the lessee was not liable for rent of a gas Avell not used off 
the premises, altho it might have been so used. The Court upheld 
their ruling on the fact that oil was what the parties expected to 
find and they were allowed to use the gas on the premises. Ohio 
Oil Co. v. Lane, 59 Ohio St. 307, 52 N. E. 791. 

Recognized Distinctions between Oil and Gas. 

The distinction between oil and gas" wells must be recognized. 
The gas is of no value if the well has no means of utilizing it. 
Where a lessee might be liable to sink more wells to prevent oil 
drainage he might not be obliged to sink wells to prevent gas 
drainage. McKnight v. Manufacturers' N. Gas Co., 146 Pa. 185, 
28 Am. St. Rep. 790, 23 Atl. 164, 17 M. R. 429. 

A lease was held by the defendant limited to oil. The well 
produced oil in small tho workable quantity, but struck a strong 
flow of natural gas which the lessee appropriated by pipes and 
sold. The Court held that this gas was an incident to the lease 
like air and water and that defendant was not liable to accouut 
for its use. Wood County Petroleum Co. v. West Virginia 
Transp. Co., 28 W. Va. 210, 57 Am. Rep. 659. 

A lessee found oil but not in paying quantities, but lie struck 



OIL AND GAS 31 

pay gas — the covenants in the lease were practically based on the 
finding of oil — the lessee was held entitled to the gas. Eaton v. 
Wilcox, 42 Him (N. Y.) 61. 

A well is not an "oil well," within the meaning of a lease 
reserving to the lessor one-tenth of "all the oil and other min- 
erals," merely because gasoline is produced as a by-product of 
the gas : lessee was not bound to pay a royalty on the gas. Wolf 
v. BlackiveU Oil & G. Co. (Okla.) 186 Pac. 484. 

A lease producing only a barrel or so of oil per day but gas 
in quantity, is a "gas well only." Ohio Oil Co. v. Burch (Ind. 
App.) 124 N. E. 781. 

Workable for Both Minerals. 

Where it is practical to operate the same well for both oil and 
gas, it is the duty of the lessee to so work it, but if it can only be 
worked for oil the lessee is not liable for rental for gas well. 
Prichard v. Freeland Oil Co., 80 W. Va. 787, 93 S. E. 871; 
Locke v. Russell, 75 W. Va. 602, 84 S. E. 948. 



CHAPTER 9. 

PROTECTION. 

The doctrine of protection is absolutely new and arises from 
the fluid underground situation of either oil or gas. Both are 
supposed to emerge through the bore of the well from saturated 
sands or what might be called natural subterranean tanks and 
the withdrawal of either the liquid or the gas necessarily induces 
a flow from all sides to fill the vacuum. 

Where the operator has no neighbors the law of protection 
has no application. But when oil is drawn from near a bound- 
ary line it will obviously drain the adjoining tract. The ad join- 
ers have prima facie equal rights. Neither is the sole owner 
until he reduces the mineral to possession or control. 

The question most generally arises between lessor and lessee, 
the former insisting on more wells to prevent drainage ; between 
lessor and lessee where the lessor owns more ground than he has 
let to a particular tenant or where he has let to several tenants ; 
between any parties in privity with either lessor or lessee or in 
some roundabout way between any two ad joiners. 

The doctrine of protection brings on a line of cases, peculiar 
to itself. There is an implied covenant to sink as many wells 
as are necessary to protect from drainage. A lessee working 
two wells from different lessors cannot favor one to the loss of 
the other. When the leased ground is subdivided, the royalty 
(under some authorities) is divided among all the owners of the 
subdivisions, and where land is cut out of the lease for any pur- 
pose, it is impliedly for protection to the main tract demised. 

The covenant to protect may be express by the terms of the 
lease, but it is usually implied and the question often does not 
arise until long after the lease has been delivered. 

Territorial Extent. 

As to the territorial extent of the protection there are few 

32 



PROTECTION 33 

decisions, nor has the distance between two wells which will 
limit the enforcement of protection ever been decided in yards 
or feet to our knowledge. In the findings of fact in Barnard v. 
Monongahela N. Gas Co., 216 Pa. 362, 65 Atl. 801, it is stated 
that one well will drain 10 acres. But no two fields are neces- 
sarily alike in this physical fact. The same is stated in 
Daughetee v. Ohio Oil Co., 263 111. 518, 521, 105 N. E. 308. In 
Bradford Oil Co. v. Blair, 113 Pa. 83, 57 Am. Rep. 442, 4 Atl. 
218, it was claimed that a well should have been sunk on every 
five acres. 

In Consumers' Gas Trust Co. v. American Plate Glass Co., it 
is stated that the sinking of a gas well within two miles would 
materially affect another well at that distance. 162 Ind. 393, 
395, 68 N. E. 1020. ■ 

A second gas well in the vicinity may destroy the value of 
the first on account of the pressure. McKnight v. Manufactur- 
ers' N. Gas Co., 146 Pa. St. 185, 28 Am. St. Rep. 790, 23 Atl. 
164, 17 M. R. 429. 

Spacing the Wells. 

The doctrine of protection brings in the question of the per- 
fect spacing between wells: It arises when an operator has a 
large tract out of which he desires to get all the oil possible but 
does not wish to sink more holes than are necessary; or where 
there are several operators, who might perhaps better combine 
on one well than to sink two competition wells. After studying 
the field, because the right spacing varies in different fields, it 
requires some mathematical or rather geometrical calculation to 
determine, not where to spend money, but where to save money 
by not wasting it. 

About 660 feet (-| of a mile) is usually close enough and in a 
gas field it should be at least twice that distance. 1 This 660 feet 
is the limit of protection selected in the Oil Leasing Act. 

It becomes material also when a lessor is seeking for a decree 
against his lessee to compel him to sink a protection well. Cer- 
tainly a forced protection well should not be so close that, if it 

1 Bacon and Ilamor, p. 423. 
M. O. R.— 3. 



34 MORRISON'S OIL RIGHTS 

were for the lessee's own protection, he would not sink it. In 
such case he should not be compelled to sink it for the mere pro- 
tection of his lessor. 

Parallelogram. 

Where the tract demised was in the form of a parallelogram 
and — the lease provided for protection for ten rods on one side 
and eight rods on the other, it was held that the protection in- 
cluded the squares in the corners, by protracting the lines of 
the outside boundaries of the 8 and 10 rods. Allison's Appeal, 
77 Pa. 221, 11 M. R. 142. 

Implied Covenant. 

There is an implied obligation to sink the number of wells 
necessary to protect the demised tract. J. M. Guffey Petroleum 
Co. v. Jeff Chaison T. Co., 48 Tex. Civ. 555, 107 S. W. 609; 
Powers v. Bridgeport Oil Co., 238 111. 397, 87 N. E. 381 ; Klepp- 
ner v. Lemon, 176 Pa. St. 502, 35 Atl. 109, 18 M. R, 404; Cul- 
bertson v. Iola P. C. Co., 87 Kan. 529, Ann. Cas. 1914A, 610, 125 
Pac. 81. Its expression in terms adds nothing to the obligation. 
Kellar v. Craig, 126 Fed. 630, 61 C. C. A. 366. And the fact that 
the lease in terms only demands one well does not exclude this 
implied covenant. Harris v. Ohio Coal Co., 57 Ohio 118, 48 N. 
E. 502, 19 M. R. 157. 

Successive Wells. 

The doctrine of protection was carried far in Kleppner v. 
Lemon, 176 Pa. 502, 35 Atl. 109, 18 M. R. 404. The lease only 
bound the lessee to sink one well but the Court held that he was 
bound to sink as many as were necessary to protect the whole 
demised tract from drainage. He was allowed to hold the well 
he had bored with a protection of 300 feet but decreed to surren- 
der all the rest of the tract unless he drilled another well. 
Mitchell, J., strongly dissented. 

Electing not to drill the second well, on the second appeal, 
Kleppner v. Lemon, 197 Pa. 430, 17 Atl. 353, he was adjudged to 
paj Full royally on all the oil lie had produced from a well on 



PROTECTION 35 

ari adjoining tract which was assumed to be oil which he would 
have got by drilling a second well which is a measure of damages: 
allowed only against parties wilfully confusing goods to prevent 
identification. On rehearing 198 Pa. 581, 48 AtL 483, 21 M. R 
275, this was conceded to be "harsh and unwarranted'' as it cer- 
tainly was. The damages were reduced to about one-seventh of 
that royalty by estimating its proportion to the whole area of 
"drainage" which the Court assumed to know. 

hi Colgan v. Forest Oil Co., 194 Pa. 234, 75 Am. St. Rep. 695, 
45 Atl. 119, 20 M. R. 338, the Court materially qualified this 
Kleppner decision. The lessee had bound himself to sink one 
well and had in fact sunk five. The court held that the lessee 
was "not bound to w T ork at his own cost for this lessor's profit." 

AVhen the number of wells is not specified in the lease, the 
obligation is to sink "sufficient wells to secure to the lessor a 
reasonable royalty'' which seems to be an impracticable sort 
of a test. Dinsmoor v. Coynbs, 111 Ky. 740, 198 S. W. o8. But 
the opinion cites many cases on the question of what number 
of wells will amount to protection which of course must vary 
indefinitely. 

Compulsion by Court to Sink. 

A covenant to protect the side lines is a covenant for protec- 
tion against drainage and requires the lessee to sink offset wells 
where danger of such drainage appears. Pelham Petroleum Co. 
v. North, 188 Pac. 1069 (Okla.). 

The report of this ease gives a map of the demised 120 acres 
showing 9 wells, 6 small producers and 3 dry holes. The Court 
held that on the question of offset wells, the defendant is not 
bound to sink such offset wells, unless the draining well was a 
paying quantity well and that in determining what is a paying 
quantity well where an offset well is the issue, the whole cost 
of bringing in such well was to be considered as well as the 
operating expenses. 

The decision is fair and clear in its exposition of abstract 
principles but the whole evidence shows that no such pay had 
been found as to justify the inference that an offset well should 



36 MORRISON'S OIL RIGHTS 

be sunk. The report shows, also, and incidentally seems to take 
into consideration, the fact that all the wells in the neighborhood 
fell off rapidly from their initial small production. The im- 
portant suggestion from the case is: How far the Court can 
make itself the judge of the necessity of sinking offset wells, 
which is a business, not a legal proposition, until it is apparent 
that the proof of the existence of a robber well is so conclusive 
as to compel the judicial overruling of the lessee's private judg- 
ment. The biblical reference to laying burdens upon others 
which cost nothing to those imposing such burdens has a strik 
ing application in these offset well cases. 

This class of suits suggets some points which we do not find 
fully considered. Assuming that the robber well takes out 
enough to make it a paying well as above defined, the offset wt. 11 
would not necessarily save all the oil which was being drained. 
Presumably each would take one equal half. In such case nei- 
ther well might continue to pay. And in any event; Is a lessee 
bound to sink an offset well unless such well, besides saving 
some of the oil which was being lost, should be expected to pay 
something over cost to the lessee compelled to sink ? 

Contracting for Protection. 

An oil and gas lease provided that lessors, in any deed to be 
made by them on a tract neighboring to the tract demised, 
should prohibit drilling for oil. The Court construed the word 
"deed" with technical strictness and held that it did not prohibit 
the granting of a lease to drill. Test Oil Co. v. La Tourette, 19 
Okla. 214, 91 Pac. 1025. 

Limiting Protection by Contract. 

The gist of the right to protection is that the lessor ought 
to receive all the royalty which should accrue from the leased 
ground and where lie has reserved no royalty but has accepted a 
rental or a bonus as the sole consideration the reason ceases to 
demand full production for the demised premises, hut does not 
cease as to 11k 1 right to he protected against foreign drainage. 

The parties to the lease may agree to a limited protection. 



PROTECTION 37 

J. M. Guffey Petroleum Co. v. Jeff Chilton T. Co., 48 Tex. Civ. 
555, 107 S. W. 609. But colessess cannot make between them- 
selves any contract as to protection wells which is binding on 
their landlord. Arnold v. Garnett Light, etc., Co., 103 Kan. 477, 
174 Pac. 1027. 

Demand. Notice to Lessee. 

When one well has been sunk which was all the lease called 
for in terms, it was the duty of the lessor to notify the lessee 
that further development was required, before forfeiture could 
be insisted on. Dinsmoor v. Combs, 177 Ky. 740, 198 S. W. 58. 

This notice seems to be of common equity demandable before 
forfeiture in all this line of cases, whether one well has been 
sunk or more than one well or no well at all. Monarch Oil, etc. % 
Co. v. Richardson, 124 Ky. 602, 99 S. W. 668. 

Alternative Decree. 

There was one lease on two tracts. On one of them pay wells 
were sunk but none had been drilled on the smaller tract. The 
defendant was held bound to prospect the smaller tract but 
should be allowed time after demand and forfeiture was denied. 
An alternative decree is proper in such cases. Alford v. Dennis, 
102 Kan. 403, 170 Pac. 1005, following Howerton v. Kansas N. 
Gas Co., 82 Kan. 367, 34 L.R.A.(N.S.) 46, 108 Pac. 813. 

Point of Sinking. 

Where the point for sinking the protection well was to be 
designated by the lessor he has no right of action when he has 
not designated the place to sink. McKnight v. Manufacturers' 
N. Gas Co., 146 Pa. 185, 28 Am. St. Rep. 790, 23 Atl. 164, 17 
M. R. 429. 

Owner's Right to Protect Himself. 

Any party has the right to drill on his own land and if his 
ground is being drained his only remedy is to sink himself. 
Barnard v. Monongahela N. Gas Co., 216 Pa. 362, 65 Atl. 801. 



38 MORRISON'S OIL RIGHTS 

Anyone has the right to build a line of protection wells near 
the exterior boundary of his property. Kelly v. Ohio Oil Co. 
57 Ohio St. 317, 63 Am. St. Rep. 721, 39 LR.A. 765, 49 N. E. 

399. 

Risk. Lessee to Decide. 

Forfeiture will not be decreed where the success of the offset 
wells is problematical. Eastern Oil Co. v. Beatty (Okla.) 177 
Pac. 104. And when judgment is required, as to the number of 
wells or where they are to be sunk, it is the lessee's judgment 
which must prevail. Kellar v. Craig, 126 Fed. 630, 61 C. C. A. 
366; Colgan v. Forest Oil Co., 194 Pa. 234, 75 Am. St. Rep. 695, 
45 At!. 119, 20 M. R, 338. 

Collusion. Two Lessors. 

A lessee from two adjoining lessors may not evasively increase 
the royalty from one tract to benefit the other. Kleppner v. 
Lemon, 176 Pa. St, 502, 35 Atl. 109, 18 M. R. 404; Colgan v. 
Forest Oil Co., 194 Pa. St. 234, 75 Am. St. Rep. 695, 45 Atl. 119, 
20 M. R. 338; Barnard v. Monongahela N. Gas Co., 216 Pa. St. 
362, 6o Atl. 801; Cnlbertsoji v. Iota P. C. Co., 87 Kan. 529. Ann. 
Cas. 1914A, 610, 125 Pac. 81. 

And where lessee was draining the oil under the demised tracts 
by working under another lease, he was ruled to sink a protection 
well or submit to forfeiture. Hvghes v. Busseyville O. &• G. Co., 
180 Ky. 545, 203 S. W. 515. 

Remedies. 

A lease may be cancelled for failure to drill the protection 
wells which the contract implies or calls for. Beatty-Nickel Oii 
Co. v. Smethers, 49 Ind. App. 602, 96 N. E. 19; Kleppner v. 
Lemon, 176 Pa. 502, 35 Atl. 109, 18 M. R. 404. But* the ordi- 
nary relief is by suit at law for damages. Doddridge Count}/ 
Oii & Gas Co. v. Smith, 154 Fed. 970. Affirmed on cost ques- 
tions in 173 Fed. 386. 

The lessor ma\' recover damages for the failure of the lessee to 
drill protection wells. The measure of damages is the diminution 



PROTECTION 39 

of the royalties by reason of such default. But indefinite proof 
will not sustain a verdict for damages. Steel v. American Oil 
Dev. Co., 80 W. Va. 206, 92 S. E. 410. 

In Culbertson v. Tola P. C. Co., 87 Kan. 529, Ann. Cas. 1914A, 
610, 125 Pac. 81, a suit for gas rents or royalties, the plaintiff 
was allowed to prove what amount of drainage gas had been 
taken by defendant from wells on adjoining ground — this opin- 
ion seems to have allowed recovery on general principles, not 
intimating how the plaintiff's share of this foreign or drainage 
gas was ascertained. 

Drainage Pending Litigation. 

The danger that while the litigation is pending, the gas may 
be drained by other parties is to be considered on bill for in- 
junction. Henry Gas Co. v. United States, 191 Fed. 132, 111 
C. C. A. 612. 

Wildcat. 

In AVildcat, that is unproven oil territory, the necessity for 
speedy development is not urgent. There is no danger of 
drainage.' Downey v. Gooch, 240 Fed. 527. 

Expert Evidence. 

The evidence of experts is admissible to show what number 
of wells should be sunk to insure protection. Culbertson v. Tola 
P. C. Co., 87 Kan. 529, Ann. Cas. 1914A, 610, 125 Pac. 81 ; How- 
erton v. Kansas N. Gas Co., 82 Kan. 367, 34 L.R.A.(N.S.) 46, 
108 Pac. 813. 

Protection of Buildings. 

Where no well was to be sunk within 300 ft. of a residence, ex- 
cept with the consent of both parties, their heirs and assigns, the 
assignee of one part of the excepted circle may drill, lessor con- 
senting with the consent of the assignee of the other parts of the 
circle. McFarlane v. Gulf Production Co. (Tex. Civ.) 204 S. 
W. 460. 



40 MORRISON'S OIL RIGHTS 

And where there is a limitation that lessee may not drill 
within a certain distance from buildings on the demised tract 
neither the lessor nor any person under him has the right to 
extract oil from the excepted area. Westmoreland, etc., Gas 
Co. v. DeWitt, 130 Pa. 235, 5 L.R.A. 731, 18 Atl. 724; Lynch 
v. Bur ford, 201 Pa. 52, 50 Atl. 228, 21 M. R. 611. 

The protection of buildings is apt to be a trifling incident 
compared to the value of the land as oil territory and it is only 
right that the lessor should as in these cases be not allowed to 
use it to the detriment of his lessee. 

Practice. 

The danger of drainage of the gas by foreign wells is not a 
fact which will prevent the remainderman from enjoining work 
by the life tenant. Richmond Natural Gas Co. v. Davenport, 
37 Lnd. App. 25, 76 N. E. 525. 

In a suit against the lessee for failure to protect against drain- 
age of the oil, all the lessors must join. Steel v. American Oil 
Dev. Co., 80 W. Va. 206, 92 S. E. 410. 



CHAPTER 10. 

LEASE. INTRODUCTORY. 

All the oil fields have been developed by leases. 

Taking a broad view of the case and laying aside the question 
of oil on the public domain, the bulk of the land throughout the 
United States has always been held in severalty by farmers who 
were entirely ignorant of its underground values. 

Beginning in 1859 it was learned that oil might be found by 
drilling. One well after another being opened in Pennsylvania 
and oil becoming gradually a commercial product, of value at 
first chiefly for hand lamps, later for fuel, coincident with the 
automobile came gasoline, until now oil with its incidents is 
one of the great industries of the world. 

This latent and unknown possibility of value produced investi- 
gation to find the oil. Few farmers had either the money or the 
faith to do their own drilling. Few capitalists would risk buy- 
ing the whole farm on the mere possibility of discovering oil, 
so that naturally and logically a compromise was adopted. The 
farmer allowed the oil seeker to test his land by lease or lease 
and option for a nominal or small consideration and was in 
case of success, either to receive a royalty or to sell at an agreed 
price. This was eminently fair to both sides. 

Out of this proposition, so simple to state, have grown in- 
numerable law suits, on the construction, working and forfei- 
ture of leases. As a matter of course unanimity of interpreta- 
tion could not be expected but gradually most points have ob- 
tained a generally received construction. 

Relations of the Parties. 

It is held in Dill v. Fraze, 169 Ind. 53,79 N. E. 971; Rich v. 
Doneghey (Okla.) 177 Pac. 86, that the ordinary oil and gas 
lease does not create the relation of landlord and tenant. This 

41 



42 MORRISON'S OIL RIGHTS 

seems a contradiction in terms, but is consistent with the Indi- 
ana cases which it cites. Altho not a lease it is a valid contract 
enforceable between the parties. 

There is no relation of trust and confidence between lessor 
and lessee : they may deal at arms' length. Colgan v. Forest Oil 
Co., 194 Pa. 234, 75 Am. St. Rep. 695, 45 Atl. 119, 20 M. R, 338. 

A lease is construed to be exclusive of the rights of all others 
in the possession and working of the property: Advance In- 
dustrial Co. v. Eagle Metallic Co., (Pa.) 109 Atl. 771. 

Incidental Advantages. 

If the* lessee obtains incidental or collateral advantages by 
reason of his operating adjoining tracts, he is entitled to them 
just as a stranger would be. Colgan v. Forest Oil Co., 194 Pa. 
234, .75 Am. St. Rep. 695, 45 Atl. 119, 20 M. R. 338. 



CHAPTER 11. 

LEASE. THE PARTIES. 



By Sole Owner. 



Where the lessor is sole owner no question can arise as to his 
power to lease, unless restrained b}' some covenant in his title,, 
which is not usual, but where he is one of several cotenants or 
only a life tenant or himself owner of but an estate for years, 
complications at once become apparent. 

By Life Tenant 

A life tenant cannot give an oil lease — it is the same as opening 
a new mine. Marshall v. Mellon, 179 Pa. 371, 57 Am. St. Rep. 
601, 35 L.R.A. 816, 36 Atl. 201, 18 M. R. 548 ; Richmond Natural 
Gas Co. v. Davenport, 37 Ind. App. 25, 76 N. E. 525; Barnsdall 
v. Boley, 119 Fed. 191. 

A tenant for life has the right to the annual produce of his 
land whether crops or minerals, but no right to commit waste. 
This rule of the common law therefore allows to the life tenant 
the royalties accruing from a well opened when he became life 
tenant but does not allow him to sink a new well, nor to let the 
land for the like purpose. 

This broad proposition of elementary law is a striking in- 
stance of the fact that it is impossible to codify the law into 
abstract propositions. For assuming that without right he does 
sink a well and finds oil, what is to become of the fruit of his 
•breach or trespass in case he strikes a flowing well and the oil 
is going to waste? Or, when he owns a life estate and so dare 
not sink a well, yet the land on all four sides of his tract is 
being drained, is he to suffer the destruction of both his life 
estate and the estate of his remainderman? Obviously these 

43 



44 MORRISON'S OIL RIGHTS 

propositions suggest peculiar questions and we can only answer 
them as they arise. 

Elijah Kerns, owner in severalty, gave an oil lease. Later he 
conveyed the land reserving a life estate. The Court held that 
the lease was lawful when made, was a part of the life estate and 
the royalties belonged to him. The case is on the facts compli- 
cated and the lower Court denied his right but the above short 
statement contains the ultimate facts the law on which would 
seem to be very plain. Koen v. Bartlett, 41 W. Va. 559, 56 Am. 
St. Rep. 884, 31 L.R.A. 128, 23 S. E. 664, 18 M. R, 289. 

In Gerkins v. Kentucky Salt Co., 100 Ky. 734, 66 Am. St. 
Rep. 370, 39 S. W. 444, a well was sunk under lease from the 
life tenant (who was also one of the remaindermen) with the 
knowledge and consent of several others of the remaindermen. 
It struck gas. Suit was brought by the rest of the remainder- 
men who asked that the well be closed. This was denied. The 
remaindermen were held entitled to a royalty- after the Salt 
Company had been reimbursed the cost of its expenditures. 

So the remaindermen were allowed a royalty out of an estate 
which had not come into existence and the life tenant apparently 
forfeited his life estate as a penalty for giving a lease which he 
had no right to make. 

The Gerkins case above mentioned is cited in New Domain 
0. & G. Co. v. McKinney, a very recent case in Kentucky, re- 
ported in 221 S. W. 245. There the apparent owner had given 
a lease of the entire premises although he was short in his title 
one-seventh of the estate. He was one of several heirs and had 
bought out the others, but one of them, a sister, who had con- 
veyed to him one-seventh, repudiated her deed -on account of in- 
fancy. She lived in Ohio but the land was in Kentucky. She 
was between 18 and 21 years of age, an adult in Ohio but an in- 
fant in Kentucky. vThe Court held that the law of the State 
where the land lay governed and therefore she could deny her 
deed. But the material point was the measure of damages 
which she could recover against 1hc Lessee. The Court held 
that she could recover one-seventh which entitled her to the one- 
eighth royalty, % 6 of the gross product of the wells up to the 
date when she began her suit, after which date she was entitled 



LEASE — THE PARTIES 45 

to recover one-seventh of the net profits made by the lessee and 
that as a cotenant she had a right to a voice in the management 
of the lease. 

The Court considers the basis upon which these damages are 
estimated very fully and fairly, allowing to the defendant com- 
pany all expenses of operation even the overhead expenses such 
as salaries of its officers. 

The lease containing a warranty of the one-seventh which the 
lessee failed to get, such lessee was entitled to recover one- 
seventh of the "net value of the one-seventh of the oil produced 
after the filing- of the suit" to be offset against the royalty and 
if such seventh was less than the royalty the difference should 
be paid to the lessor. 

In Marshall v. Mellon the life tenant had given an oil lease 
reserving rent. No well had been sunk but rent had accrued 
for which plaintiff sued. The Court held that as a life tenant 
had no right to give the lease it was void and he could not re- 
cover the rent. 179 Pa. 371, 57 Am. St. Rep. 601, 35 L.R.A. 
816, 36 Atl. 201, 18 M. R. 548. 

The general proposition is that the life tenant cannot right- 
fully give lease to search for oil on land not already opened for 
such purposes. This includes tenants by the curtesy and dow- 
agers. But if such a lease is given and oil or gas is found the 
royalties go to the remaindermen. Williamson v. Jones, 43 W. 
Va. 562, 64 Am. St. Rep. 891, 38 L.R.A. 694, 27 S. E. 411, 19 M. 
R. 19. 

Where the life tenant let a lease and one of the two remainder- 
men ratified, the nonconsenting remainderman must treat the 
case as the extraction of mineral by a cotenant. Mcintosh v. 
Ropp, 233 Pa. 497, 82 Atl. 949. 

Where tenant by curtesy and remaindermen join in a sale or 
lease, the tenant by curtesy is entitled to all the royalties or pro- 
ceeds of the fund during his life. Blakley v. Marshall, 174 Pa. 
425, 34 Atl. 564, 18 M. R. 350; Deffenbaugh v. Hess, 225 Pa. 638, 
36 L.R.A. (N.S.) 1099, 74 Atl. 608. 

On the decease of a life tenant, lessor, the remainderman, may 
adopt the lease. Distribution of proceeds of the lease in such 
case considered. Matlack v. Kline (Mo.) 216 S. W. 323. 



46 MORRISON'S OIL RIGHTS 

Lease of Cotenant. 

A single cotenant has no right to let a lease on the whole 
land. Gulf Refiining Co. v. Carroll, 145 La. 299. 82 So. 277. 
Nor has a majority of the co-owners any greater right. Each 
lias the right to let a lease on his own interest, but it is self-evi- 
dent that a lessee cannot work an undivided interest in a mine 
without working the whole interest. Notwithstanding the tech- 
nical want of right in one, or any number less than the whole 
of the co-owners, to let the whole premises, it is constantly done 
and the question then is what are the rights of the nonconsent- 
ing cotenants? 

Risk of Mining. 

The decisions generally agree to the point that the single co- 
tenant takes all the risks of mining. If the mine fails to pay, 
he must stand the loss and if it makes a profit, he must divide 
with his co-owners. McCord v. Oakland Q. Min. Co., 64 Cal. 134, 
49 Am. Rep. 686, 27 Pac. 863. If he bores for oil and finds it, 
his cotenants share the profits, but if he sinks a barren well, he 
stands the whole loss himself. Williamson v. Jones, 43 W. Va. 
562, 64 Am. St. Rep. 891, 38 L.R.A. 694, 27 S. E. 411, 19 M. R. 
19. This last cited case gives a full discussion of the rights of 
cotenants and also of life tenant and remainderman, all of which 
parties were involved in that suit. 

Accounting Between. 

The real issue is reached when it comes to an accounting with 
the cotenants. In Early v. Friend, 16 Grat. (Va.) 21, 78 Am. 
Dec. 649, 14 M. R. 271, the fair rental value is made the basis 
of accounting. Coleman's Appeal, 62 Pa. 252, 14 M. R. 221, 
allows the plaintiff cotenant to recover the value of the ore in 
place. Either of these two rules according to the facts of the 
case is an equitable basis. Improvements are to be deducted 
from the oil royalties on such an accounting. Miller v. Powers, 
184 Ky. 417, 212 S. W. 453. 

In accounting for oil taken by a cotenant the measure of 
damages is the fair market value of the mineral in place and 



LEASE THE PARTIES 47 

the royalty may be the test of this value. Mcintosh v. Ropp, 
233 Pa. 497, 82 Atl. 949. 

On an accounting for proceeds of oil well in litigation all 
parties concerned may be brought in on supplemental bill and 
the Court will adjudicate even questions purely matters at law. 
Probst v. Bearman (Okla.) 183 Pac. 886. 

A tenant in common is liable to his cotenants for their shares 
of the proceeds and, by construction of the Waste Act of West 
Virginia, he cannot offset the cost of sinking the well. Danger- 
field v. Caldwell, 151 Fed. 554, 81 C. C. A. 400. 

Where two cotenants executed at different times two separate 
leases to two separate parties, each lease conveying the undivided 
half interest of the lessor : It was held that each lessee had the 
right of possession to work for the minerals, but neither had 
the right to exclusive possession. Compton v. People's Gas Co., 
75 Kan. 572, 10 L.R.A.(N.S.) 787, 89 Pac. 1039. 

The basis of accounting between tenants in common, where 
one has taken the oil in good faith under claim of title, is the 
value of the oil, less the whole cost of production including the 
drilling. McNeely v. South Perm Oil Co., 58 W. Va. 438, 
52 S. E. 480. 

A case often referred to is Job v. Potton, L. R. 20 Eq. 84 ; 14 
M. R. 329. It decides that the licensee of a cotenant is not a 
trespasser and that on accounting all costs of mining are to be 
deducted. 

In the case of Silver King C. Mines Co. v. Conkling Mining 
Co., 255 Fed. 740, a heavy judgment was affirmed against a 
cotenant working a lode mine. It fairly states the rule of ac- 
counting, allowing generally all costs of mining but showing 
instances where they must be disallowed. 

Taking the oil by one joint owner to the exclusion of his co- 
tenant is waste and may be enjoined by the excluded co-owner. 
Paxton v. Benedum-Trees Oil Co., 80 W. Va. 187, 94 S. E. 472. 
But a cotenant may ratify the lease of his cotenant and require 
him to account for his proportion of the royalties. 

The Illinois decisions treat a cotenant working or leasing the 
whole property as little better than a trespasser. Murray v. 
Haverty, 70 111. 318, 14 M. R. 325; Zeigler v. Brenneman, 237 



48 MORRISON'S OIL RIGHTS 

111. 15, 86 -N. E. 597. This extreme holding has not been gen- 
erally followed. 

The lease by one cotenant of the whole premises is valid as to 
his own interest, but void as to his cotenant's interest. Under a 
later lease by all the cotenants, to a lessee with notice of the first 
lease, no title passes to the undivided interest first demised. 
Zeigler v. Brenneman, 237 111. 15, 86 N. E. 597. 

Lessee Held Liable. 

Where a single cotenant demises the whole property, his lessee 
is liable with such lessor to the injured cotenants. McNeely v. 
South Penn Oil Co., 58 "W. Va. 438, 52 S. E. 480. 

Waiver of Tort. 

The cotenant may waive the tort and require an accounting 
for money had and received when the coal has been sold by 
his cotenant. Cecil v. Clark, 49 W. Va. 459, 39 S. E. 202. 

Cotenants' Contracts — When Personal to Him Alone. 

Where a cotenant receives delay rentals on his lease, such 
money is held as his own property and he is not bound to share 
it with his cotenants. McNeely v. South Penn Oil Co., 58 W. Va. 
438, 52 S. E. 480; Patterson v. Clem, 79 W. Va. 666, 91 S. E. 
654. But if his cotenants had been parties to, or if they ratify 
his lease, they become entitled to share. Sommers v. Bennett, 68 
W. Va. 157, 69 S. E. 690. 

Rent received by tenant in common in possession, for delay, 
constitutes no part of the damages for which he is accountable 
to a cotenant. McNeely v. South Penn Oil Co., 52 W. Va. 616, 
44 S. E. 508. 

This line of decisions does not refer to the leasing of a co- 
tenant's interest, but to contracts for assignment of his share or 
treating for options on it. Such dealings are manifestly con- 
fined to his own individual interest and his associates have no 
right to share in them. 

Tenants in common of oil rights may subdivide the land into 
small tracts. Bronson v. Lane, 91 Pa. 153. 



LEASE — THE PARTIES 49 

Husband and Wife. Homestead. 

The common-law restrictions on the power of the wife to con- 
tract are now in most of the States abolished. To conveyance 
but not to lease her signature is generally required. If, how- 
ever, a lease is outstanding at the date of the husbands decease, 
her dower rights attach to the royalties. Campbell v. Lynch, 81 
W. Va. 374, 94 S. E. 739. And the funds of the wife advanced 
to the husband to work a mine, will be protected as her prop- 
erty on an accounting. Patterson v. Stroecker, 245 Fed. 732, 
158 C. C. A. 134. 

An oil and gas lease on a homestead, requires the joint con- 
sent of the husband and the wife. Carter Oil Co. v. Popp 
(Okla.) 174 Pac. 747; Gillespie v. Fulton Oil, etc., Co., 140 111. 
App. 147; McEntire v. Thomason (Tex. Civ.) 210 S. W. 563; 
Haynie v. Stovall (Tex. Civ.) 212 S. W. 792. 

That the wife of a homesteader failed to sign the lease or 
option, is no ground for cancellation. Griffin v. Bell (Tex. Civ.) 

202 S. W. 1034. On similar facts injunction was refused against 
the grantees in the deeds not signed by the wife. Rumsey v. 
Sullivan, 166 App. Div. 246, 150 N. Y. Supp. 287. 

The husband as tenant by curtesy is entitled to all the royal- 
ties from a coal lease made by his deceased wife. Caudil v. 
Wagoner, 184 Ky. 381, 212 S. W. 422. 

It is not against public policy for husband to contract to se- 
cure a lease to be executed by the wife. Robinson v. Smalley, 
102 Kan. 842, 171 Pac. 1155. 

Infants. Lunatics. 

Neither of such parties can give a valid lease, but their con- 
tracts to such effect while voidable are not void. The Court 
having jurisdiction will usually authorize a lease upon proper 
showing. Mallen v. Ruth Oil Co., 231 Fed. 845, 146 C. C. A. 41. 
This case states the peculiar situation of oil land held by infants. 
A guardian cannot lease beyond the period of infancy. Law- 
rence E. Tierney Coal Co. v. Smith's Guardian, 180 Ky. 815, 

203 S.~ W. 731. On restoration of reason the guardianship 
ceases. Bayer, In re, 80 Wash. 340, 141 Pac. 682. After major- 
ity age reached, a minor will be held to her ratification with full 

M. O. R.— 4. 



50 MORRISON'S OIL RIGHTS 

knowledge of a minority lease. Lasoya Oil Co. v. Zulkey, 40 
Okla. 690, 140 Pac. 160. 

A purchaser at guardians sale buys at his own risk, and he 
will not be protected against a prior disposition of the royalty 
by the father in his lifetime. Headley v. Hoopengarner, 60 W. 
Va. 626, 55 S. E. 744. 

Infants are not estopped by the acts of their guardian in fail- 
ing to demand for them their full share of the royalty. Head- 
ley v. Hoopengarner, 60 W. Va. 626, 55 S. E. 744. 

Wrong Party. 

It is no ground to set aside a lease that the lessee was not the 
party lessor intended to contract with, there being no misrepre- 
sentation or wrong done to the lessor. Price v. Biggs (Tex. 
Civ.) 217 S. W. 236. 

Not Covered by General Power. 

A will authorizing the execuctor to lease the land, a farm, 
was construed to forbid the letting of an oil and gas lease. Lan- 
yon Zinc Co. v. Freeman, 68 Kan. 691, 75 Pac. 995. 



CHAPTER 12. 

LEASE. THE TERM. 

In reckoning the duration of the term, the date of the lease 
should be excluded. Eastern Oil Co. v. Coulehan, 65 W. Va. 531, 
64 S. E. 836. 

Referring in one lease to term of another lease, does not 
render term uncertain. Butler v. City of Iola, 100 Kan. Ill, 
163 Pac. 652. It is not necessary that a lease should contain a 
definite term — as long as the wells produce, makes the term. 
Busch Everett Co. v. Vivian Oil Co., 128 La. 886, 55 So. 564; 
Dickey v. Coffeyville, etc., Tile Co., 69 Kan. 106, 76 Pac. 398. 

The lease usually fixes a definite term of years to be extended 
if oil or gas is found in paying quantities. If no mineral is 
found during the fixed term, the paying quantities clause does 
not extend the fixed term. Or the length of the term may be 
by the limitation of the time to sink. The duration of the 
term has in eases been construed as determinable only by the 
forfeiture clause — forfeiture of course ending the term of any 
lease. 

Where there was a grant of all the coal which was held by 
a conveyance in fee, a limitation of a certain number of years 
to remove it, is not inconsistent with this construction. Greek 
v. Wylie (Pa.) 109 Atl. 529. 

A lease for a definite term with the right to surrender does 
not create a tenancy determinable by either party. Poe v. Ulreij, 
233 111. 56, 84 N. E. 46. 

Reference to Paying Quantity. 

A lease for twelve years "or as long as oil is found in paying 
quantity" is a lease for twelve years and as much longer as oil is 
so found. Eaton v. Wilcox, 42 Hun (N. Y.) 61. 

Where a lease is to endure for the paying quantities term and 

51 



52 MORRISON'S OIL RIGHTS 

drilling has ceased for seven months for want of a market, with 
no prospect of a market, it becomes ended by its own terms. El- 
liott v. Crystal Springs Oil Co. (Kan.) 187 Pac. 692. 

Under the paying quantities and surrender clauses, the lease 
may become determined as to one well deemed unprofitable and 
remain valid as to others which pay. Dickey v. Coffeyville, etc., 
Tile Co., 69 Kan. 106, 76 Pac. 398. 

When a natural gas lease was to terminate when natural gas 
ceased to be used for manufacturing purposes, or when the lessee 
failed to pay the rent, held that it did not create a tenancy from 
year to year and that failure to pay did not terminate the con- 
tract, but only gave the lessor the right to end it. Hancock v. 
Diamond Plate Glass Co., 162 Ind. 146, 70 N. E. 149. 

A gas lease was based on an annual rent and to cease on the 
disuse of gas for manufacturing purposes in the locality, or upon 
failure to pay the rent. The lessee never took possession. It was 
held to be a lease from year to year and that at the end of any 
year either party could terminate it, the one by refusing to pay, 
the other by refusing to accept the rent. Diamond Plate Glass 
Co v. Curless, 22 Ind. App. 346, 52 N. E. 782, 19 M. R. 682; 
Diamond. Plate Glass Co. v. Echelbarger, 24 Ind. App. 124, 55 
N. E. 233. Both these cases were overruled by Hancock v. Dia- 
mond Plate Glass Co., 162 Ind. 146, 70 N. E. 149, which held that 
it was not a lease from year to year and failure to pay the rent 
gave to the lessor only, the right to terminate the contract. The 
later case of Hancock v. Diamond Plate Glass Co., decided that 
the rulings cited from 22 and 24 Ind. App. were the law of the 
case notwithstanding that later, the contrary had been decided. 

A lessee cannot declare a well unprofitable when it is not so 
in fact, altho the lease used words which seemed to allow him to 
be the sole judge on such issue. The decision is peculiar on this 
point for the lessee was not making any such assertion but the 
lessors' assignees were trying to cancel the lease. Dickey v. Cof- 
feyville, etc., Tile Co., 69 Kan. 106, 76 Pac. 398. 

Time to Drill. 

Allowance of five years time to begin to drill and extending to 
twenty years upon payment of a specified consideration is not so 



LEASE THE TERM 53 

unreasonable as to avoid the lease. Bingle v. Quigg, 74 Kan. 581, 
87 Pac. 724. 

A lease for a cash bonus allowing 120 days to commence work 
with delay rental of $20 per month was an option to the lessee 
to work or pay and by his failure to do either the contract was 
at once at an end. Risch v. Burch, 175 Ind. 621, 95 N. E. 123. 

A lease for ten years providing that if a well was not sunk in 
five years, lessee must pay $40 per annum is a grant for ten 
years if the rent be paid and the $40 is not a mere penalty to 
secure the sinking. M on fort v. Lanyon Zinc Co., 67 Kan. 310, 72 
Pac. 784. 

The grant of all the oil by deed without limitation of term, 
second party to drill within a fixed time or pay a rent with the 
right to surrender by reconveyance is a lease at an annual rental 
at the option of the lessee only. Central Ohio Natural Gas, etc., 
Co. v. Eckert, 70 Ohio 127, 71 N. E. 281. 

On a lease for a fixed term with the paying quantities clause 
and a delay rental, with a clause that drilling the well should 
extinguish the rental, the term was held to be extended beyond 
the fixed period by the drilling of the well. Proivani v. Sealy 
(Okla.) 187 Pac. 235. 

A lease ran for the term of two years, a well to- be drilled 
within one year and to run twenty-five years if oil and gas were 
found with the right to extend the time to drill by paying an acre- 
age rent for "each year thereafter until a well shall be drilled." 
The Court held it to be a lease for two years and that the phrase 
"until a well shall be drilled" meant, until drilled within the 
term of two years, giving no effect to the words "each year" 
altho there was only one year to be covered. Brown v. Fowler, 
65 Ohio 507, 63 N. E. 76. 

Lessee Entitled to Notice. 

In Indiana Natural Gas & Oil Co. v. Beales, 166 Ind. 684, 76 
N. E. 520, the lease was for twelve years, lessee to sink or pay 
delay rental, the lease containing the common paying quantities 
clause followed by "or the payments hereinafter provided for 
are made" and the court held that when the twelve years ex- 



54 MORRISON'S OIL RIGHTS 

/ 

pired, the lessor could not terminate the lease without giving 
notice and a reasonable further time to begin operations. 

Enjoined Term. 

Where the lessee under five years term was wrongfully en- 
joined from working, it was held that at the close of the litiga- 
tion, the enjoined time was to be added to the term. Stahl v. 
VanVleck, 18 M. R. 231, 53 Ohio 136, 41 N. E. 35. 



CHAPTER 13. 

LEASE. THE CONTRACT. 

The Demising Clause. 

The leases in general use, demise and let certain real estate, 
or land, describing it by governmental subdivisions, or as a cer- 
tain placer claim, or by metes and bounds. The words of de- 
mise may be of "the right to enter upon" or it may be a letting 
of the oil and gas to be found. But the first form is preferable. 
In Brown v. Wilson (Okla.) 160 Pac. 94, is an elaborate review 
of the verbiage of oil and gas leases. This is an overruled case, 
and is referred to only on the point of such review. 

Not Signed by the Lessee. 

The signature of the second party, the lessee, is not essential. 
He is like the grantee in a deed poll which is subscribed by the 
grantor only. Lawson v. Kirchner, 50 W. Va. 344, 40 S. E. 344, 
21 M. R. 683 ; Chandler v. Hart, 161 Cal. 405, Ann. Cas. 1913B 
1094, 119 Pac. 516 ; Indianapolis Natural Gas Co. v. Kibbey, 135 
Ind. 357, 35 N. E. 392, 17 M. R. 677 ; Allan v. Guaranty Oil Co., 
176 Cal. 421, 168 Pac. 884. 

Not Witnessed. 

An oil and gas lease not witnessed as required by Statute may 
be valid as an agreement to make a lease. Allegheny Oil Co. v. 
Snyder, 45 C. C. A. 604, 106 Fed. 764. 

Blanks. 

Where a material blank is left unfilled, the covenant contain- 
ing the blank has been held void for uncertainty. Eaton v. Wil- 
cox., 42 Hun (N. Y.) 61. And that the number of dollars in the 

55 



56 MORRISON'S OIL RIGHTS 

surrender clause being left unfilled, the provision was void. 
Riddle v. Keechi Oil & Gas Co. (Okla.) 176 Pac. 737. And that 
where the lessee's name 'was omitted, and the delay blank not 
filled in, the lessee was entitled to fill in the blanks, but having 
failed so to do before the lease was recorded, it was, as recorded, 
void on its face and let in a lease to a new party. Root v. Town- 
send (Ky.) 215 S. W. 936. 

Description. Premises Demised. 

The lessee was to sink on a single acre to be designated out 
of one of several adjoining 40 acre tracts, and if he struck oil 
on this single acre, he was to become lessee of one whole 40 acre 
tract. The court held that the 40 acre tract out of which the 
single acre had been selected was the tract to be covered by the 
promised lease. Stakl v. Van Vleck, 18 M. R, 231, 53 Ohio, 136, 
41 N. E. 35. 

A lease in the ordinary form covers a well already drilled on 
the premises. Kemp v. Bar Gas Co., 103 Kan. 595, 175 Pac. 
988. 

Parol evidence cannot add land not covered by the contract 
in the absence of the allegation of fraud or mistake. Duffield v. 
Hue, 17 M. R. 253, 129 Pa. 94, 18 Atl. 566. 

"Where the issue is as to the ground necessary to operate an 
oil well, it is a question of fact to be decided by the jury. Moore 
v. Decker (Com. App. Tex.) 220 S. W. 773. 

Where a lease was given on two separate tracts the lease being 
assigned as to one of the tracts it continues to be one lease and 
the drilling of the well on one of the tracts protects both of them. 
Gypsy Oil Co. v. Cover (Okla.) 189 Pac. 540. 

Papers Construed as Leases. 

An agreement for a lease may be in fact the lease itself. Chi- 
cago <£ A. Oil, etc., Co. v. United States Petroleum Co., 12 M. 
R. 570, 57 Pa. 83. 

Mineral contracts partaking of the nature of sale or demise 
will be treated as leases. Spruce v. Lucas, 138 La. 763, 70 So. 
796; Cooke v. Gulf Refining Co., 135 La. 609, 65 So. 758L, 



LEASE — THE CONTRACT 57 

A paper which "demises" and leases land for a fixed term to 
work for oil, conveys a present interest — purporting to distin- 
guish the lease from that construed in Brookshire Oil Co. v. Cas- 
malia, etc., Dev. Co., 156 Cal. 211, 103 Pac. 927, where it was 
held that no present title passed. Chandler v. Hart, 161 Cal. 405, 
Ann. Cas. 1913B 1094, 119 Pac. 516. 

A conveyance containing both the words of a deed of grant, 
and of a lease covering coal, salt, oil and other mineral rights 
on land known to have produced oil, was construed with refer- 
ence to the known condition at the time of its delivery and by 
the construction of the parties, to be a lease and not a convey- 
ance. McMillin v. Titus, 222 Pa. 500, 72 Atl. 240. 

In Clay v. Palmer (Nebr.) 177 N. W. 840, a very informal 
contract to allow the working of a lake for Potash to be extracted 
from its solution was construed to be practically a lease. 

Legal Status of the Lease. 

There is little agreement or consistency in the decisions as to 
the legal classification of an oil lease. 

Many cases call it an incorporeal hereditament. Perhaps as 
many call it an estate in land, or in other words a corporeal here- 
ditament. It is constantly confounded with or distinguished 
from a license. 

Funk v. Haldeman, 53 Pa. 229, is a case often cited on the 
subject. There had been given by deed the right to explore for 
oil, for a bonus paid and a royalty. The Court held it was neither 
a sale nor a lease of the mineral but a license coupled with an 
interest, not revokable except on breach. This made it an in- 
corporeal hereditament. 

When a license is irrevocable and is coupled with an interest, 
we fail to see what remains to practically distinguish it from 
a lease except that it is not assignable and perhaps not divisible. 
Otherwise it is a lease to all intents and purposes. 

The opinion cites Lord Mountjoi/s case, 9 M. R. 175, a short 
but leading case which enumerates the incidents of a license. 
This case decided during the reign of Elizabeth, is variously re- 
ported, and a curious history of it is given in Grubb v. Bayard, 
2 Wall. Jr. 81, Fed. Cas. No. 5,849, 9 M. R. 199. This Grubb 



58 MORRISON'S OIL RIGHTS 

case held that the grant of the right to take the iron ore, aitho 
without stint, was only a license. To the same effect is Johns- 
town Iron Co. v. Cambria Iron Co., 32 Pa. 241, 72 Am. Dec. 788, 
9 M. R. 226. The case of Rynd v. Rynd Farm Oil Co., 63 Pa. 
397, cites Funk v. Haldeman cautiously and altho involving the 
construction of an important oil lease is confined to the technical 
point as to whether ejectment was the proper form of action. 

An incorporeal hereditament is something related to real estate 
which is inheritable, but not tangible. Instances given, are, 
right of common, rents and annuities supported on land. It 
may include certain easements. 

Among the cases which call it an incorporeal hereditament 
are Robinson v. Smalley, 102 Kan. 842, 171 Pac. 1155; Huston v. 
Cox, 103 Kan. 73,. 172 Pac. 992 ; Walla Walla Oil etc., Co. v. 
VallenUne, 103 Wash. 359, 174 Pac. 980; State v. Welch (Okla.) 
184 Pac. 786, 787; Payne v. Neuval, 155 Cal. 46, 99 Pac. 476; 
White v. Green, 103 Kan. 405, 173 Pac. 974. 

But the cases agree that it is more than a license and that it 
creates an interest in the land. McKean Natural Gas Co. v. Wol- 
cott, 254 Pa. 323, 98 Atl. 955, and that however described or 
defined, it is property and as such is subject of transfer with the 
right of protection. Shaffer v. Marks, 241 Fed. 139; McEntire 
v. Thomason (Tex. Civ.) 210 S. W. 563. It does not convey a 
vested interest in the oil, but does convey a vested right to find 
the oil with the right to possession in the search for it. Lindhvj 
v. Raydure, 239 Fed. 928 ; Rawlings v. Armel, 70 Kan. 778, 79 
Pac. 683; Beatty Oil & Gas Co. v. Blanton, 245 Fed. 979; Bren- 
nan v. Hunter (Okla.) 172 Pac. 49. 

A case in West Virginia takes a practical view of this subject. 
Speaking of the various forms of leases it says : "such dissimilar- 
ity as may seem apparent is really inconsequential — they are in 
fact the same and not essentially different." Johnson v. Arm- 
strong, 81 W. Va. 399, 94 S. E. 753, 755. 

Freehold Character. 

In determining the freehold character of the lease, it lias been 
held that it is not a conveyance of real estate — it is a chattel 
real. Duff v. Keaton, 33 Okla. 92, 42 L.R,A.(N.S. 472. 124 IV • 
291. Tupeker v. Deaner, 46 Okla. 328, 148 Pac. 853. That 



LEASE — THE CONTRACT 59 

the lease itself is personal property and therefore not cov- 
ered by the devise of all "lands and premises" owned by the 
testator. Wagner v. Mattery, 169 N. Y. 501, 62 N. E. 584. 
And that an oil lease altho its grant is of an incorporeal heredita- 
ment is a contract concerning lands within the recording Acts. 
MoNish v. Stone, 17 M. R. 22, 152 Pa. 457, 25 Atl. 732 note. 
And that a lease for a fixed term and as long as gas or oil is 
found in paying quantities conveys a freehold estate. Daughetee 
v. Ohio Oil Co., 263 111. 518, 105 N. E. 308. 

What the Lease Carries. Title to the Mineral. 

The following citations define the status of the lessor and the 
lessee and the ownership of the minerals sought for in various 
language. Their substance is that the lease itself does not con- 
vey title to the oil or gas in place. That there is onty the priv- 
ilege to explore and search but that the mineral when found 
becomes the property of the lessee and the estate vests in him. 
Especially, that the lessee's right becomes absolute after sinking 
the well and finding the oil or gas. One or more of them hold 
that the lease is a conveyance of mineral rights subject to de- 
feasance by failure to drill or to pay the rentals. 

Oil and gas leases are in a class by themselves, in the nature 
of licenses conveying the mineral, conditioned on its being found, 
and when found, the right to produce it becomes a vested right. 
Dickey v. Coffeyville, etc., Co., 69 Kan. 106, 76 Pac. 398; Kan- 
sas Nat. Gas Co. v. Neosho- County Com'rs, 75 Kan. 335, 89 Pac. 
750. 

Right of Action. 

The lessor has a right of action for breach of the covenants of 
the lease when it arises, without waiting till the end of the term. 
Daughetee v. Ohio Oil Co., 263 111. 518, 105 N. E. 308. 

The oil lease in general use conveys no title to the oil in place 
to the lessee. It is only a grant of the privilege to explore. The 
lease confers only an inchoate right until oil or gas is found, 
when the title becomes vested. Frank Oil Co. v. Bellevieiv Gas, 
etc., Co., 29 Okla. 719, 119 Pac. 260, 261, 43 L.R.A.(N.S.) 487; 
Backer v. Penn. Pnb. Co., 162 Fed. 627, 89 C. C. A. 419; Smith 



60 MORRISON'S OIL RIGHTS 

v. Root, 66 W. Va. 633, 30 L.R.A. (N.S.) 176, 66 S. E. 1005; 
Ulrey v. Poe, 134 111. App. 298; Munsey v. Marnet Oil,, etc., Co. 
(Tex. Civ.) 199 S. W. 686; Headley v. Hoopengarncr, 60 W. Va. 
626, 55 S. E. 744; McGraiv Oil & Gas Co. v. Kennedy, 65 W; Va. 
595, 28 L.R.A.(N.S.) 959, 64 S. E. 1027. An oil lease is the con- 
veyance of mineral rights subject to defeasance by failure to 
drill or pay the rentals. Key v. Big Sandy Oil, etc., Co. (Tex. 
Civ.) 212 S. W. 300; Jackson v. Pure Oil Operating Co. (Tex. 
Civ.) 217 S. W. 959. 

An oil lease in consideration only of the future royalties vests 
no present title and a completion of a nonproductive well, does 
not operate to carry the title to the lessee. Steelsmith v. Gart- 
lan, 45 W. Va. 27, 44 L.R.A. 107, 29 S. E. 978, 19 M. R. 315. 

The lessee of the right to mine for oil has a vested interest, 
a right of possession of all the necessary surface and holds a 
corporeal hereditament. Duke v. Hague, 107 Pa. 57 ; Chicago & 
A. Oil & Mining Co. v. United States Petroleum Co., 57 Pa. 
83, 12 M. R. 570. 

Property Right of Lessee. 

An oil lease gives only the right to search for the oil, the right 
of exploration — if oil not found, no estate vests in the lessee, 
but when founded on a consideration is to be protected from for- 
feiture. Lowther Oil Co. v. Miller-Sibley Oil Co., 53 W. Va. 
501, 97 Am. St. Rep. 1027, 44 S. E. 433, 22 M. R, 656; Calhoon 
v. Neely, 201 Pa. 97, 50 Atl. 967, 21 M. R. 754 ; Brunson v. Car-> 
ter Oil Co., 259 Fed. 656 ; Steelsmith v. Gartlan, 45 W. Va. 27, 
44 L.R.A. 107, 29 S. E. 978, 19 M. R, 315; Carr v. Huntington 
Light, etc., Co., 33 Ind. App. 1, 70 N. E. 552. 

A lessee has no property in the oil until it is reduced to pos- 
session. Wagner v. Mallory, 169 N. Y. 501, 62 N. E. 584, 22 
M. R. 42 ; Huggins v. Daley, 20 M. R. 377, 99 Fed. 606, 40 C. 
C. A. 12, 48 L.R.A. 320; Watford Oil & Gas Co. v. Shipman, 233 
111. 9, 122 Am. St. Rep. 144, 84 N. E. 53 ; Kansas Nat. Gas Co. v. 
Board of Com'rs of Neosho County, 75 Kan. 335, 89 Pac. 750. 

A mining lease is not equivalent to a sale of the ore in place. 
Von Baumbach v. Sargent Land Co., 242 U. S. 503, 61 L. ed. 
460, 37 Sup. Ct. 201; Nelson v. Republic Iron, etc., Co., 240 Fed. 
285, 153 C. C. A. 211 ; United States v. Biivabik Mm. Co., 247 



LEASE — THE CONTRACT 61 

U. S. 116, 62 L. ed. 1017, 38 Sup. Ct. 462. Nor does the pay- 
ment of a bonus make it such a sale. Moore v. Sawyer, 167 Fed. 
826 ; Headley v. Hoopengarner, 60 W. Va. 626, 55 S. E. 744. 

Protection and Drainage. 

When the parties to the lease reach the items of drainage and 
protection, then a necessary distinction does arise between classes 
of leases, but protection and drainage, should have nothing to do 
with the legal construction of the lease: it is a matter that arises 
afterwards in controversies with adjoining oil seekers. 

Or and Unless Leases. 

A distinction has been expressed in several cases between what 
the Court calls "Or leases" and "Unless leases," based on the 
form of the terms used. One requires work unless a rent is 
paid, the other requires the lessee to work or pay rent. 

Under the "Unless" leases, as long as the rents are paid, lessee 
has an option to continue the lease; failure to pay the rent 
terminates the contract. Under the "Or" lease failure to pay 
does not terminate the contract. Northwestern Oil & Gas Co. v. 
Branine (Okla.) 175 Pac. 533. Shaffer v. Marks, 241 Fed. 139, 
reviewing many cases, holds that both forms authorize forfeiture, 
unless one of the alternations is performed, but such forfeiture 
may be relieved against when equitable conditions exist. And 
this "Or and Unless" distinction is referred to in Hopkins v. 
Zeigler, 259 Fed. 43. Smith v. Guffey, 202 Fed. 106, 120 C. C. 
A. 436, considering two leases of slightly variant terms as to 
their duration, considered the difference as negligible. 

The case of Garfield Oil Co. v. Champlin, (Okla.) 189 Pac. 
514, states the distinction between an "or lease" and an "unless 
lease." Under an "or lease" the lessee surrenders upon payment 
of the agreed consideration and on failure to surrender becomes 
bound to the payment of the rent. Under an "unless lease" the 
lease automatically terminates by the failure to pay the rent. In 
Brunson v. Carter Oil Co., 263 Fed. 935, this artificial distinc- 
tion is deprecated as too refined. This Garfield case reviews 
many of the decisions on the usual points in oil cancellation 
cases. 



CHAPTER 14. 

LEASE. CONSTRUCTION. 

Whatever is Implied 

in a lease is as effectual as what is expressed ; implication being 
only another name for intention and everything is implied which 
is necessary to accomplish what is expressed. Brewster v. Lan- 
yon Zinc Co., 140 Fed. 801, 72 C. C. A. 213. 

An express covenant to perform certain acts implies a cove- 
nant to refrain from performance of other acts which operate to 
defeat performance of the express covenant. Millan v. Bartlett, 
69 W. Va. 155, 71 S. E. 13. 

Ignorance of the contents of the lease is of itself no sufficient 
excuse for noncompliance. Garfield Oil Co. v. Champlin 
(Okla.) 189 Pac. 514. 

The Written Insertions Control 

the printed form when they are inconsistent. Producers* Oil 
Co. v. Snyder (Tex. Civ.) 190 S. W. 514; Johnston v. Shaffer 
(Okla.) 176 Pac. 901; Duffield v. Hue, 129 Pa. 94, 18 Atl. 566, 
17 M. R, 253. 

Lessor Favored in Construction. 

Oil or gas leases are to be construed favorably to the lessor. 
Aycock v. Reliance Oil Co. (Tex. Civ.) 210 S. W. 848; Curtis v. 
Harris (Okla.) 184 Pac. 574; Frank Oil Co. v. Belleview Gas Co., 
29 Okla. 719, 119 Pac. 260, 43 L.R.A.(N.S.) 487; Owens v. Cor- 
sicana Pet. Co. (Tex. Civ.) 169 S. W. 192; New State Oil & Gas 
Co. v. Dunn (Okla.) 182 Pac. 514; Rechard v. Cowley (Ala.) 
80 So. 419; Hitson v. Oilman (Tex. Civ.) 220 S. W. 140; Gar- 
field Oil Co. v. Champlin, 189 Pac. 514 (Okla.) 

Oil leasing companies prepare their own forms, and their 

62 



LEASE — CONSTRUCTION 63 

leases are to be construed strictly against them — in favor of the 
lessor. Ohio Oil Co. v. Burch (Ind. App.) 124 N. E. 781; Prow- 
ant v. Sealy (Okla.) 187 Pac. 235. 

General Rules of Construction. 

In the construction of oil and gas leases the court will discard 
ambiguous or contradictory provisions and determine the true 
meaning of the contract if possible. Stahl v. Illinois Oil Co., 
45 Ind. App. 211, 90 N. E. 632 • Ohio Oil Co. v. Detamore, 165 
Ind. 243, 73 N. E. 906. The words "or" and "and" will be read 
to mean what was intended. Bettman v. Harness, 42 W. Va. 433, 
36 L.R.A. 566, 26 S. E. 271, 18 M. R. 500. 

AY here the language of a contract is doubtful, that construc- 
tion should be preferred, which makes it fair and such as prudent 
men would naturally execute. Withington v. Gypsy Oil Co. 
(Okla.) 172 Pac. 634. But inclining against the covenantor. 
Ohio Oil Co. v. Burch (Ind. App.) 124 N. E. 781. And not al- 
lowing a party to take advantage of his own wrong. Andrews v. 
Andrews, 256 Pa. 24, 100 Atl. 521. 

On points of practice and evidence common to all leases, it is 
held that the written terms cannot be contradicted by parol 
where not ambiguous. Wright v. Gillespie, 261 Fed. 46. And 
that their terms cannot be questioned by a stranger to the con- 
tract. Indianapolis Natural Gas Co. v. Kibbey, 135 Ind. 357, 35 
N. E. 392, 17 M. R. 677. And that where there was an under- 
standing contrary to the terms of the lease, the burden of proof 
to show such fact was upon the party alleging it. Doane v. 
Rising Sun M. Co. (Ark.) 213 S. W. 399. 

When the lease covers other minerals the rules for considera- 
tion of a lease of fugacious minerals, do not strictly apply. Mc- 
Cttllough v. Smith, 243 Fed. 823, 156 C. C. A. 335. 

Time is of the essence of the lessee's contract to sink or pay 
rent. Garfield Oil Co. v. Champlin, 189 Pac. 514 (Okla.). See 
page 82. 

Parties Construction. 

Where the parties themselves construed the lease that it called 



64 MORRISON'S OIL RIGHTS 

for the rent in advance the Court held them to their own con- 
struction. Bearman v. Dux Oil, etc., Co. (Okla.) 166 Pac. 
199. But in Nelson v. Republic Iron, etc., Co., 240 Fed. 285, 
153 C. C. A. 211, it was ruled that the lessor was not bound by 
his interpretation of the meaning of the reservation of the rents 
and royalties. 

Where the terms are clear it cannot be varied by the subse- 
quent conduct of the parties. Jameson v. Chanslor-C an field, etc., 
Oil Co., 176 Cal. 1, 167 Pac. 369. This case so decides, but it is 
obvious that it is one of those rules which neither courts nor their 
clientage ever live up to. 

The parties own construction of the lease, in case of doubt, 
will be accepted by the Court. Balfour v. Russell, 18 M. R. 202, 
167 Pa. 287, 31 Atl. 570; Ohio Oil Co. v. Burch (Ind. App.) 
124 N. E. 781. Even where the language used might strongly 
suggest another interpretation. Pittsburg, etc., Brick Co. v. 
Bailey, 76 Kan. 42, 12 L.R.A.(N.S.) 745, 90 Pac. 803. But 
not where the lease clearly reads otherwise. Diamond Plate 
Glass Co. v. Tennell, 22 Ind. App. 132, 52 N. E. 168. The acts 
of the parties are to be looked to in construing an oil lease. 
Stahl v. Illinois Oil Co., 45 Ind. App. 211, 90 N. E. 632. Where 
the lease provides for written notice of certain things to the 
lessor, notice jn fact may be-shown by the acts of the parties in 
relation to the premises. May v. Hazelivood Oil Co., 152 Pa. 518, 
25 Atl. 564. 

Federal Courts. 

The Federal Courts should follow the local law in the con- 
struction of oil and gas leases. State Court decisions establish- 
ing rules of property on oil leases are binding on the Federal 
Court. Washburn v. Gillespie, 261 Fed. 41. But tlieir views 
on equitable principles are only persuasive. Doicney v. Gooch, 
240 Fed. 527; Smith v. Guffey, 202 Fed. 106, 120 C. C. A. 436; 
Shaffer v. Marks, 241 Fed. 139. 

Civil Law Construction. 
Jennings-Heywood Oil Syndicate v. IIoussiere-Lalrcille Oil 



LEASE CONSTRUCTION 65 

Co., 119 La. 793, 44 So. 481, was a case on the construction of an 
oil lease under the civil law. The Court being divided, delivered 
several opinions, reversing- on rehearing its first decision and 
finally deciding that: 

The lessee being at liberty to drill or not to drill at his elec- 
tion, there was no contract on this point binding on the lessee. 
If there was a contract, it was broken by failure to sink. That 
an option must be exercised within the time limited, not even 
vis major excusing : that a fire in the oil field would excuse work- 
ing, but not delay in making tender of money. 

That the delay rental should have been paid in advance and 
that delay rental clauses may be abrogated by consideration of 
other terms in the lease demanding development. 

The case is instructive as a discussion of some fundamental 
propositions under the Code Napoleon, but not decisive of any 
material point and on the whole coincides with the common-law 
conclusions. 

Wildcat Territory. 

The lessee on new territory where oil has never been known 
has the right to demand long time and liberal terms. Where 
there is no fraud or imposition courts have no right to set aside 
an oil lease in terms agreed to by both parties. Bingle v. Quigg, 
74 Kan. 581, 87 Pac. 724. 

In construing an oil lease, the Court must place itself in 
the position of the parties. The contract in this case was for the 
development of Wildcat property. Prowant v. Sealy (Okla.) 
187 Pac. 235. 

M. O. R.— 5. 



CHAPTER IS. 

LEASE. CONSIDERATION. 

The main consideration of the vast number of ordinary leases 
is the payment of rent bnt when we come to oil and gas leases it 
is complicated by various peculiar incidents. Many of them ex- 
press a money consideration usually nominal for the mere right 
to enter and work. Where this sum is more than nominal it is 
called a bonus. Then come the covenants to drill, to pay royalty, 
with provisions for delay rentals, forfeiture, protection against 
drainage, reservation of surface right and others not usual in 
farm or house leases. 

Where there is a binding covenant of any sort imposing rent, 
royalty, or a duty to do something, in other words a promise 
compellable, to be performed, there is no need to express a formal 
consideration for the lease. The covenant to pay or the covenant 
to perform is a consideration of itself. But an express consider- 
ation in an oil and gas lease is often recited usually to make a 
prima facie showing against its being unilateral. 

An oil lease is only a license to enter and develop, for which 
license a consideration is necessary. Hitson v. Gilman, 220 S 
W. 140 (Tex. Civ.) 

Exploration and development are the controling consideration 
for an ordinary oil and gas lease. Advance Oil Co. v. Hunt 
(Ind. App.) 116 N. E. 340. 

The payment of a valuable consideration does not relieve the 
lessee from the performance of the express covenants of the 
lease. Aijcock v. Reliance Oil Co. (Tex. Civ.) 210 S. W. 848; 
Emery v. League, 31 Tex. Civ. 474, 72 S. W. 603. But the fur- 
ther consideration of development to be done, is not demandable 
where a present consideration has been paid for the lease. 
Chandler v. Hart, 161 Cal. 405, Ann. Cas. 1913B 1094, 119 Pac. 
516. 

66 



LEASE CONSIDERATION 6 i 

Where a lease is delivered in exchange or lieu of a prior 
lease the consideration of the first lease holds good for the 
second. Johnson v. Russell (Tex. Civ.) 220 S. W. 352. 

The $1 Consideration. 

The agreement to expend money in sinking supports the $1 
consideration, notwithstanding the presence of the surrender 
clause. The opinion quotes exhaustingly the decisions on the $1 
consideration clause in oil and gas leases. Lindlay v. Raydure, 
239 Fed. 928, affirmed Raydure v. Lindlay, 249 Fed. 675, 161 
( \ C. A. 585. The cases of Rechard v. Cowley (Ala.) 80 So. 419, 
and Lovett v. Eastern Oil Co., 68 W. Va. 667, Ann. Cas. 1912B, 
360, 70 S. E. 707 also hold good the $1 consideration. Rich v. 
Do iieg hey (Okla.) 177 Pac. 86 also, is a full case on the point 
and overrules Brown v. Wilson, 58 Okla. 392, L.R.A.1917B 1184, 
160 Pac. 94. 

The consideration of $1 held to cover not only the grant of 
the term, but the privilege of extending the time for drilling by 
paying the stipulated price. Allegheny Oil Co. v. Snyder. 108 
Fed. 764, 45 C. C. A. 604. Under Ohio decisions oil and gas 
leases carry an implied covenant to drill, operate and protect, 
which covenant the lessor may enforce by action. Id. 

The consideration of $1 held to make the contract of lease 
mutual and to extend to all the clauses of the lease. Brown v. 
Fowler, 65 Ohio 507, 63 N. E. 76. It supports the fixed term and 
the delay rental clause. Pittsburgh Vitrified, etc., Brick Co. v. 
Bailey, 76 Kan. 42, 12 L.R.A.(N.S.) 745, 90 Pac. 803. And the 
surrender clause. Magnolia Petroleum Co. o. Saylor (Okla.) 
180 Pac. 861. 

The right to surrender does not avoid the legal effect of the 
paid consideration of one dollar. Poe v. TJlrey, 233 111. 56, 84 
X. E. 46. And the consideration of one dollar actually paid will 
support not only the option to develop but the further condition 
of a delay rental. Hitson v. Gilman (Tex. Civ.) 220 S. W. 140. 

In Oklahoma it was held that the $1 consideration supported 
the clause giving the period to complete the well and no other 
stipulation in the lease. Brown v. Wilson, 58 Okla. 392, 160 Pac. 
94, L.R.A.1917B, 1184. But that case has been repeatedly over 



68 MORRISON'S OIL RIGHTS 

ruled. McCray v. Miller (Okla.) 186 Pac. 1089. In Northwest- 
ern Oil & Gas Co. v. Branine (Okla.) 175 Pac. 533, it is held 
that the Court has no right to fractionize the consideration and 
say that it supports any particular covenant to the exclusion 
of another. Rich v. Doneghey (Okla.) 177 Pac. 86, 99; Magnolia 
Petroleum Co. v. Baylor (Okla.) 180 Pac. 861, and Maud Oil Co. 
v. Bodkin 180 Pac. 959 (Okla.) follow the Brainine case and 
decide among other points that the down payment or cash bonus 
consideration in the lease support all its covenants and that the 
surrender clause does not subject the lease to cancellation. Mc- 
Kay v. Lucas (Tex. Civ.) 220 S. W. 172. 

The consideration of $1, is passed upon in a recent Texas 
case, McKay v. Tally (Tex. Civ.) 220 S. W. 167, holding it to be 
valid : That even if not paid the lease may be construed as an en- 
forceable promise to pay it and the Court refer to the general 
principle that the recital of a consideration in a deed precludes 
the grantor from attacking the deed as a muniment of title. 
In the further discussion of the subject they say that if the con- 
sideration of one dollar was inserted "simply to conform to a 
belief that a written contract must name some sum, it may be 
regarded as a consideration in name only, and in that sense 
nominal, and not upon agreement," which quotation leaves the 
whole subject in a chaotic and unsatisfactory condition. 

It is followed by McKay v. Kilcrease (Tex. Civ.) 220 S. W. 
177, which later case adds that other considerations not recited, 
may be proved to aid the one dollar named. 

Our own conclusions from the many decisions on the point 
are : That the $1 consideration supports the lease as the grant 
of an estate for years and all its terms including the right of 
election to pay delay rentals and the surrender clause. And 
will defeat efforts at forfeiture or cancellation based on alleged 
want of consideration. But that it is not good to sustain a plea 
for nondevelopment or the right to lie idle if such claim is 
not supported by some other clause in the lease tending neces- 
sarily to that conclusion and that it is not sufficient to support 
a decree for specific performance. That its payment need not 
be proved and its nonpayment may. not be shown, and that it 
has nothing to do with the defense of inadequate consideration 



LEASE CONSIDERATION 69 

which is a point practically confined to bills for rescission based 
on fraud. 

Parol evidence will not be allowed to show that the $1 had 
not been paid. Lindlay v. Raydure, 239 Fed. 928; Contra, 
Raines v. Dunson, 145 La. 239, 82 So. 690. 

The civil law unlike the common law does not construe the 
nominal sum of $1 as a substantial consideration. Murray v. 
Bamhart, 17 La. 1023, 42 So. 489. 

Inadequate Consideration. 

Nolan v. Young (Tex. Cix.) 220 S. W. 154, was a ease where 
an option agreement or oil lease was attacked on the allegation 
that the consideration was inadequate. It wasc held that the 
Court properly refused to allow proof that the $10 paid was not 
considered the real consideration and that the sole inducement 
for the lease was to secure the sinking of a test well. The case is 
practically confined to that one point the suggestions of fraud 
not being proven. The Court admits that there has been lack 
of harmony in the decisions on this point but claims the weight 
of authority to be in favor of the validity of the paper and of its 
consideration. 

The distinction between a valuable consideration and an in- 
adequate consideration is considered in Hitson v. G-ilman (Tex.) 
220 S. W. 140 and Hunter v. Gulf Prod. Co. (Tex. Civ.) 220 S. 
W. 163. Inadequacy of consideration becomes material in cases 
of alleged fraud while the valuable consideration though small 
is sufficient to bring the lease within the definition of a contract. 

Promise When Not Consideration. 

A promise may support a promise but where it is clear that 
the lessee had no intent to perform his promise to drill, and 
there is no specific obligation to pay a delay rental, the eon- 
tract is without consideration. And on the facts of the case, 
the payment of the delay rental was held to be no estoppel. 
Hitson v. Gilman (Tex. Civ.) 220 S. W. 140. 

Mere inadequacy of consideration is not of itself ground to 



70 MORPISOX'S OIL RIGHTS 

avoid au oil and gas lease. Brewster v. Lcmyon Zinc Co., 140 
Fed. 801, 72 C. C. A. 213; Lindlay v. Raydure, 239 Fed. 928. 

Protection Covenants. 

Covenants to not sink, or to exclude certain ground from being 
drilled, are of value in natural gas fields and constitute valuable 
considerations. Simpson v. Pittsburgh Plate Glass Co., 28 Ind. 
App. 343, 62 N. E. 753. 



CHAPTER 16. 

LEASE. BONUS. 

Bonus as Consideration for Lease. 

Rent or royalty is the almost universal and generally the sole 
real consideration of any sort of lease. Such a lease is based 
upon a promise to do, pay or perform. But the lessee may ad- 
vance a money consideration for the lease and where such ad- 
vance is not a mere nominal sum this advance or bonus seems to 
release the implied covenants usually imposed on the lessee. The 
lessor no longer relies on promises to be performed in the future 
but has value received in the shape of pay. 

In Griffin v. Bell (Tex. Civ.) 202 S. W. 1034, the lessee had 
paid a bonus of $70 for the lease. The Court held that it was 
a valuable and adequate consideration to support all the grants 
of the lease: that where there is a money consideration paid 
there is no implied covenant to sink and that the fact that the 
lessee did not intend to drill and was holding lease for specula- 
tion was no ground to cancel it. 

This last proposition is counter to many cases where no bonus 
had been paid but the reasoning of the opinion is strong and but 
for the fact that the bonus was very small, agrees with the com- 
mon idea of the legal profession that men have the right to con- 
tract as the}' please, barring agreements contrary to public 
policy or otherwise forbidden. 

The payment of a bonus supports every provision of the lease. 
Shaffer v. Marks, 241 Fed. 139; Carter Oil Co. v. Tiffin (Okla.) 
176 Pac. 912; Northwestern Oil & Gas Co. v. Branine (Okla.) 
175 Pac. 533; Magnolia Petroleum Co. v. Saylor (Okla.) 180 
Pac. 861. 

Sufficiency of Bonus, Question of Fact. 

"Whether the $70 cash paid for an option wrs sufficient to make 

71 



72 MORRISON'S OIL RIGHTS 

an adequate consideration, is a question of fact for the jury if 
the contract is not unilateral on its face. Griffin v. Bell (Tex. 
Civ.) 202 S. W. 1034. 

When a lessee company agreed to pay a bonus in case its 
proposed well proved a success and assigned the lease, it was held 
liable for the bonus, the condition having been fulfilled. Gem 
Oil Co. v. Callendar (Okla.) 173 Pac. 820. 

The general manager of an oil company has the right to meet 
emergencies and his action was approved in changing the bonus 
of a sinking contract. Minion t>. D'Yarmett (Tex. Civ.) 212 S. 
W. 518. 



CHAPTER 17. 

LEASE. UNILATERAL. MUTUALITY. 

Oil and gas leases have been continually attacked on the al- 
legation of being unilateral. This is one of the forms of alleging 
want of consideration, as a violation of the universally received 
definition of a contract, to wit: an agreement or promise to do, 
or not' to do something for a consideration. 

"Where they are unilateral they are to be construed strictly. 
Bearman v. Dux Oil & Gas Co. (Okla.) 166 Pac. 199, but an 
oil lease containing the usual covenants, is not unilateral. 
Hughes v. Parsons, 183 Ky. 584, 209 S. W. 853, and it is of the 
very essence of an option that it should not be mutual. The 
optionee pays his money in purchase of the right of choice. 
Northwestern Oil & Gas Co. v. Branine (Okla.) 175 Pac. 533. 

"A unilateral contract is one in which there is a promise on one 
side only, the consideration on the other side being executed." 
This definition is then followed by a discussion at length of the 
question of mutuality. Rich v. Doneghey (Okla.) 177 Pac. 86, 
90. 

It may be stated in general that attacks on oil leases for w T ant 
of either consideration, or of mutuality, have usually failed — 
except on bills for specific performance where both mutuality 
and consideration seem to be required. 

And why should they not fail? Both parties on the surface 
contract or attempt to contract about value supposed to exist a 
thousand feet under the spot where they stand. The one who 
undertakes to demonstrate this value takes all the risk and it is 
unconscionable to say that he shall be denied the realization of 
his anticipations for nonconformity to an abstract proposition 
upon which so many different opinions have been delivered in 
the attempt to apply it to the ever varying complications of oil 
and gas contracts. 



74 MORRISON'S OIL RIGHTS 

Consideration and Mutuality Distinguished. 

Consideration is continually confounded with mutuality or 
want of mutuality. A consideration is essential but mutuality is 
not. Where there is a promise against a promise, one promise is 
a consideration for the other and there is mutuality — so that 
there is both consideration and mutuality. An option contract 
is not mutual but the contract which gives it must be supported 
by value received or promised, otherwise it is neither mutual 
nor has it a consideration. If one party never was bound to do 
the thing which forms the consideration of the promise of the 
other, there is such a want of mutuality as makes the agreement 
voidable but when the other party performs it, the consideration 
comes into being. The matter of this paragraph is reasoned 
and sustained in Rich v. Doneghey (Okla.) 177 Pac. 86, 98, and 
Hopkins v. Ziegler, 259 Fed. 43, reversing Ziegler v. Hopkins, 
258 Fed. 467. 

An analysis of the reasoning of the Court leads up to the con- 
clusion that a promise to be performed at the performers option 
is void, unless supported by a consideration; but this considera- 
tion may be by royalty, rent, or even the nominal payment of $1 
— and the promise may allow to the lessee a choice of several 
things, to wit ; 1 to develop, 2 to pay a nominal sum and give up 
the lease or; 3 pay a delay rental. "The lessee cannot escape 
from all these obligations. He may escape two of them but he 
is absolutely bound to do one of the three." Other language of 
the Court is, that "consideration is essential, mutuality of obliga- 
tion is not, unless the want of mutuality would leave one party 
without a valid or available consideration for his promise." 

There are many other cases on the same line leading the 
judges to the field of abstract and scholastic propositions and 
tracking far from the practical solution of the issues of vital in- 
terest to the litigants, but this opinion seems to state the general 
legal conclusion in exceptionally clear terms. 

A covenant to do one of two things in the alternative, i. e., 
sink or pay rent, does not impart a fatally unilateral character 
into the lease. But a lease which does not take effect unless the 
lessee does a certain act is only executory and is not operative 
if the condition is not performed. Hopkins v. Ziegler^ 259 Fed. 



LEASE UNILATERAL MUTUALITY . T£> 

43, citing Guffey v. Smith, 237 U. S. 101, 59 L. eel. 856, 35 Sup. 
Ct. 526; Lindlay v. Raydure, 239 Fed. 928; Bay dure v. Lindlay, 
249 Fed. 675, 161 C. C. A. 585 ; Van Etten v. Kelly, 66 Ohio St. 
605, 64 N. E. 560, 22 M. R. 269; Glasgow v. Chartiers Oil Co. y 
152 Pa. 48, 25 Atl. 232, 17 M. R. 523 ; Shaffer v. Marks, 241 Fed. 
139 and note 44 L.R.A.(N.S.) 50, referring to Ohio Valley 
Oil & Gas Co. v. Irvin Dev. Co., 184 Ky. 517, 212 S. W. 110, as 
possibly contra. 

A contract granting the oil and other minerals, lessees to be- 
gin work within a certain time, is not unilateral. Price v. Biggs, 
(Tex. Civ.) 217 S. W. 236. 

An oil lease calling for quarterly delay rentals and allowing 
surrender upon payment of the nominal consideration of $5 
was held unilateral and void in Owens v. Corsicana Petroleum 
Co. (Tex. Civ.) 169 S. W. 192. On a very similar paper by the 
same Court later, the contrary was held and the Corsicana case 
doubted. Pierce Fordyce Oil Assn. v. Woodrum (Tex. Civ.) 
188 S. W. 245. 

The option to surrender does not make the lease unilateral. 
Rechard v. Cowley (Ala.) 80 So. 419. 

The fact that lessee's covenants are largely optional does not 
invalidate the contract. Ulrey v. Poe, 134 111. App. 298. 

When the conditions of the lease have been in part performed 
and a consideration has passed to the lessor, the right to surren- 
der becomes valid as nonunilateral. Ulrey v. Poe, 134 111. App. 
298. 

Only the lessor can claim that a lease is unilateral from the 
presence of the surrender clause ; the lessee in a subsequent lease 
cannot urge the invalidity of a prior lease for that reason. Breu- 
nan v. Hunter (Okla.) 172 Pac. 49. 

The issue of stock to the lessor by a company, the assignee 
proposed in the lease, defeats all assertion of want of mutuality. 
McEntire v. Thomason (Tex. Civ.) 210 S. W. 563. 



CHAPTER 18. 

LEASE. THE SURRENDER CLAUSE. 

The express right to surrender is inserted in many of the 
printed forms of oil leases tho sometimes left to inference from 
other clauses. The decisions almost uniformly support it and 
when once exercised it ends the lease and all further rent and 
of course all royalty ceases. Without regard to the technical 
question of consideration there is strong equity to support it. 
The lessee starting in good faith to sink may learn from the ill 
success of his neighbors that further drilling is useless or the 
market for oil or gas may disappear or the price of the product 
materially decrease, so as to render further operations hopeless 
of reimbursement. If it be said that these are mere business 
chances which should have been foreseen, the reply is that in con- 
tracts concerning staple goods there is only a margin of danger, 
but in the matter of oil and gas sinking, judicially recognized 
as a hazardous business, the loss if there be a loss is almost cer- 
tain to be of the whole capital invested and that where such 
danger becomes apparent, further expenditure while a total loss 
to the lessee is of no corresponding advantage to the lessor. 

The surrender clause is for the benefit of the lessee. McKee 
v. Grimm, 57 Okla. 680, 157 Pac. 308. And is to be strictly con- 
strued in favor of the land owner. Shaffer v. Marks, 241 Fed. 
139. When the blank for the surrender clause was not filled in 
it was held not expressed. Riddle v. Keechi Oil, etc., Co. (Okla.) 
176 Pac. 737. 

The right to surrender, releases damages for delay in sink- 
ing. Ardizonne v. Archer (Okla.) 177 Pac. 554. The sum of 
$25. was held a good and sufficient consideration for the right 
to surrender in Diuiaway v. Galbraith (Ark.) 214 S. W. 33. 

\ lessee bound himself to sink or pay delay rental. After 
such express covenant came a clause that he, the lessee, has "the 
option to drill the well or pay such rental or not as he may elect." 

76 



LEASE SURRENDER CLAUSE / < 

The Court held that the quoted clause did not release the lessee 
from his express covenants. McMillan v. Philadelphia Co., 159 
Pa. 142, 28 Atl. 220. This case was followed in Jackson v. 
O'Hara, 183 Pa. 233, 38 Atl. 624, 19 M. R. 153, on a lease with 
the same wording. The Court treated the claim as "unjust and 
absurd." Nevertheless we consider that it was only one method 
of reserving the right to surrender the lease which is everywhere 
upheld and does not deserve the strong condemnation above 
quoted. 

The presence of the surrender clause, gives lessor no right 
to determine the lease when the lease has not reached its term. 
McCray v. Miller (Okla.) 184 Pac. 781. 

Object and Effect. 

The clause reserving the right to surrender has some practical 
object and such object is under allowable conditions, to escape 
the expense of sinking or the payment of rentals. 

When exercised it is a discharge from the obligation to sink 
and of all other covenants; in other words it ends the lease. 
But it does not defeat the collection of rent where the right 
to collect such rent has become already vested. It has no re- 
troactive effect upon the status when the surrender materializes. 
Aderhold v. Oil Well Supply Co., 158 Pa. 401, 28 Atl. 22: Ed- 
monds v. Mounsey, 15 Ind. App. 399, 44 N. E. 196; Bettman v. 
Shadle, 22 Ind. App. 542, 53 N. E. 662; Galey v. Kellerman, 123 
Pa. 491. 

Not Automatic. 

And the surrender does not become operative by the mere 
fact that the conditions exist upon which to predicate the right 
to exercise it. If the lessee is allowed to bring in the well or pa,y 
rent and does neither he cannot escape liability because he has 
the right to elect to surrender but must exercise the right, by 
tender- of formal release or perform any other condition upon 
which the right to surrender is asserted. The "null and void" 
clause, is not automatic. McKee v. Grimm, 57 Okla. 680, 157 
Pac. 308; Cohn v. Clark, 48 Okla. 500, 150 Pac. 467 ; Leather man. 



78 MORRISON'S OIL RIGHTS 

v. Oliver, 151 Pa. 646, 25 Atl. 309; Ogclen v. Hairy, 143 Pa. 
640, 23 Atl. 324; Bay v. West Pa. N. G. Co., 138 Pa. 576; Scott 
v. Lafayette Gas Co. 42 Ind. App. 614, 86 N. E. 495. 

Associated with Delay Rentals. 

The right to surrender is almost invariably associated with 
the delay rental clause and there is more than one line of deci- 
sions on the point. Eclipse Oil Co. v. South Venn Oil Co., 47 
W. Va. 84, passed on a case where the lessee did not bind himself 
to do anything for more than a year. The Court held that such 
a contract was nudum pactum until something had been done by 
one party to bind the other and that it was revocable by either 
at any time. 

But most leases before they come up for adjudication are valid 
contracts which have undoubted legal validity at the outstart. 
The Court is called on to decide on the effect of the delay rental. 
A few cases hold that the main consideration being development, 
the landlord may refuse the delay rental if no well has been 
started. Armitage v. Mt. Sterling 0. & G. Co., 80 S. W. 177 • 
Long v. Sun Co., 132 La. 601, 61 So. 684; National Pipe Line 
v. Teel, 67 S. W. 545 (Tex. Civ.) ; Jennings Hey wood Oil Synd. 
v. Houssiere Latreille Co., 119 La. 793, 44 So. 481. 

But the lessor cannot refuse the delay rental without giving 
the lessee reasonable notice of such election so as to allow suffi 
cient time to sink the well. Consumers Gas Co. v. Worth, 163 
Ind. 141; Warren 0. & G. Co. v. Gilliam, 182 Ky. 807. 

There are cases which hold that the delay rental is a condition 
precedent to make the lease good until the well is completed 
which is the just and natural construction and the same as held 
in other cases cited in this chapter in different language. Hays 
v. Forest Oil Co., 213 Pa. 556; Glasgow v. Chartiers Oil Co., 
152 Pa. 48; Parish Fork Oil Co. v. Bridgewater Gas Co., 42 S. 
B. 655, 59 L.R.A. 566 ;West em Pa. Gas Co. v. George, 161 Pa. 
47; Indiana N. G. Co. v. Granger, 70 N. E. 395 (Ind. App.). 

We find no case where the lessor is allowed to collect such 
rent and refuse further time except the few instances where it is 
considered to be in the nature of a penalty for delay already 



LEASE SURRENDER CLAUSE . 79 

accrued or as consideration for the original license to prospect 
the land. Htiggins v. Daley, 99 Fed. 606. 

The Right to Surrender. 

When the lease was to become void if no well was sunk or the 
rent not paid, but there was no express covenant to do either, 
the lessee has the right to surrender. Glasgow v. Chartiers Oil 
Co., 17 M. R. 523, 152 Pa. 48, 25 Atl. 232 ; Van Etten v. Kelly, 
66 Ohio St. 605, 64 N. E. 560, 22 M. R. 269 ; Brooks v. Kunkle, 

24 Ind. App. 624, 57 N. E. 260, 20 M. R. 540. 

Complete cessation of work after sinking a dry well is a sur- 
render of the lease. McNish v. Stone, 17 M. R. 22, 152 Pa. 457, 

25 Atl. 732 note ; Venture Oil Co. v. Fretts, 17 M. R. 543, 152 
Pa. 451, 25 Atl. 732. 

The right to surrender does not invalidate the lease nor ren- 
der it void for want of mutuality nor give the lessor the right to 
cancel. Lindlay v. Raydure, 239 Feci. 928 ; Northwestern Oil & 
Gas Co. v. Branine (Okla.) 175 Pac. 533; Jackson v. Pure Oil, 
etc., Co. (Tex. Civ.) 217 S. W. 959; Rich v. Doneghey (Okla.) 
177 Pac. 86, 88. 

The right to surrender on notice given to the lessee, does not 
confer a similar right on the lessor. Eastern Oil Co. v. Beatty 
(Okla.) 177 Pac. 104. 

A lease for which $1 consideration is paid and requiring the 
tenant to drill and pay royalty with the alternative of a delay 
rental is not a mere option revocable at the lessor's will. And 
the right of surrender does not give the lessor the correlative 
right to cancel. The right to surrender the lease for cancellation 
on payment of $1 does not render the lease unilateral, so as to 
give the lessor the right to cancel. (The opinion reviews the 
cases on this point.) Lovett v. Eastern Oil Co., 68 W. Ya. 667, 
Ann. Cas. 1912B, 360, 70 S. E. 707. 

Notice of intention to surrender must be given before the 
beginning of the year intended to be surrendered. The mere 
cessation to use gas from the well is not equivalent to surrender 
or notice of surrender. Double v. Union Heat, etc., Co., 172 Pa. 
388, 33 Atl. 694, 18 M. R. 327. 

A single cotenant of the lease cannot surrender it so as to 



80 MORRISON'S OIL RIGHTS 

bind his associates. Edmonds v. Jlounsey, 15 Ind. App. 399, 44 
N. E. 196,- 18 M. R. 384; Hooks v. Forst, 18 M. R. 139, 165 Pa. 
^38, 30 Atl. 846. 

An oil lease may be surrendered by parol. Hooks v. Forst, 
165 Pa. 238, 30 Atl. 846, 18 M. R, 139. 

A tender after rescission will not revive a surrendered lease. 
Hooks v. Forst, 165 Pa. 238, 30 Atl. 846, 18 M. R. 139. 

Whether a lease has been surrendered is a question of fact, 
for the jury. Garrett v. South Penn Oil Co., 66 W. Va. 587, 
66 S. E. 741. 

Andrews v. Andrews, 256 Pa. 24, 100 Atl. 521, is. a peculiar 
case not likely to arise again where oil was struck on leased 
ground eight years after the date of the lease and seven years 
after the decease of the lessor ; but the lessor in his will had 
anticipated the possible finding of oil and had provided for it. 
The case is of value principally upon the point that the long 
delay did not give rise to a presumption of a surrender of the 
lease. 

In Pucini v. Bumgamer (Okla.) 175 Pac. 537, the lease con- 
tained the surrender clause with a proviso that such clause was 
to become void upon the institution of a suit by the lessee to 
enforce the lease. The proviso was held valid without any refer- 
ence to the fact that it was the waiver without consideration of 
a party's right to legal relief and obviously contrary to public 
polic.y. It is referred to in Brunson v. Carter Oil Co., 259 Fed. 
656, 665. 

Where a lessee is allowed to remove his property and re-con- 
vey the premises and so cancel the lease, there is a corresponding 
right in the lessor before development to compel surrender. Mel- 
ton v. Cherokee Oil, etc., Co. (Okla.) 170 Pac. 691. The opinion 
cites Brown v. Wilson, 58 Okla. 392, L.R.A.1917B, 1184, 160 
Pac. 94, since overruled and seems contrary to many of the above 
citations. 

In M on fort v. Lanyon Zinc Co., 72 Pac. 784, the lease was 
held extendible on a yearly payment of $40 and $25 was held 
good and sufficient consideration in Dunaway v. Galbraith, 214 
8. W. 33 (Ark.). 

A coal lease providing no time to begin mining and wholly 



LEASE-— SURRENDER CLAUSE 81 

executory allowing lessee at any time to cancel at his volition, 
is unilateral and will be cancelled on bill filed for such purpose. 
Daniel Boone Co. v. Miller, 217 S. W. 666. (Ky.) 

Assigns Protected. 

Where on payment of an acreage rent the lessee surrenders, 
his assigns cannot be held for delay in sinking the well. Ardi- 
zonne v. Archer, 111 Pac. 554 (Okla.) 
M. 0. R.— 6. 



CHAPTER 19. 

LEASE. THE COVENANT TO SINK. DILIGENCE. 

In practically every oil or gas lease there is an express cove- 
nant to work, if not expressed, it is usually implied and the 
measure of performance is reasonable diligence. 

The essential purpose of an oil and gas lease is to develop 
production. Dill v. Fraze, 169 Ind. 53, 79 N. E. 971. 

A lessee will not be permitted to let the well lie idle for specu- 
lative purposes. Gadbury v. Ohio, etc., Gas Co., 162 Ind. 9, 62 
L.R.A. 895, 67 N. E. 259, 22 M. K, 680. 

Neither party has the arbitrary right to decide what is dili- 
gence: that is for the Court to determine. Strange v. Hicks, 
188 Pac. 347 (Okla.) 

Covenant to Sink. 

This covenant may be in terms to sink or drill or to work or 
commence operations or in other words having the same meaning. 
If there is no specific covenant to such effect, it is nevertheless 
always implied unless distinctly negatived. 

There is -an implied covenant to develop within a reasonable 
time. Failure to complete within the given time authorizes for- 
feiture or cancellation. Neiv State Oil & Gas Co. v. Dunn 
(Okla.) 182 Pac. 514; Hughes v. Parsons, 183 Ky. 584, 209 S. W. 
853. Development within a reasonable time is a condition ex- 
pressed or implied in all oil leases. Dinsmoor v. Combs, 177 Ky. 
740, 198 S. W. 58; New State Oil & Gas Co. v. D.unn (Okla.) 
182 Pac. 514. 

There is an implied covenant to keep on at work when oil or 
gas is found. Strange v. Hicks, 188 Pac. 347 (Okla.) 

After the expiration of the time limited for the first well, a 
covenant attaches to continue to prosecute the work of. develop- 
ment and production. The failure to keep such covenant was a 

82 



LEASE — -COVENANT TO SINK 83 

substantial breach entitling the lessor to forfeiture, altho due to 
a misconstruction of the obligations of the lease. Breivster v. 
Lamjon Zinc Co., 140 Fed. 801, 72 C. C. A. 213. 

A promise to pay rent until, in lessee's judgment, oil or gas 
cannot be found or having been found have ceased to exist, 
clearly imposes an agreement to explore. Consumers' Gas Trust 
Co. i\ Littler, 162 Ind. 320, 70 N. E. 363. 

Reasonable Time. 

What is reasonable time is usually for the jury but where the 
facts are conceded it becomes a question of law for the Court. 
American Window Glass Co. v. Indiana, etc., Oil Co., 37 Ind. 
App. 439, 76 N. E. 1006. 

Default on Time. 

Where the lessee made default in drilling within a specified 
time and in paying the delay rental, time was material, and for 
feiture must follow failure to do either. Rowe v. Atlas Oil Co., 
84 So. 485, 147 La. — . 

Where a lease called for first payment which was made and for 
a further payment if the well was not drilled within a certain 
time, but no specified date was fixed for such payment the lessee 
could not be placed in default until after such second payment 
had been demanded. Keen v. Logan, 84 So. 501, 147 La. — . 

The lease cannot be cancelled for failure to develop until 
lessors have refused the rent and notified the lessee to proceed 
after which notice he has a reasonable time to commence to drill. 
Ocala Oil Co. v. Hughes, 219 S. W. 799 (Ky.) 

Completion of Well. 

A completed well means finished or sunk to the depth neces- 
sary to find the oil or to such a depth as, in the absence of oil, 
precludes the probability of finding it at a further depth. Frost 
v. Martin (Tex. Civ.) 203 S. W. 72. 

The sinking of a well being the consideration of the lease, the 
consideration stands, altho the well was immediately plugged, 
and the casing withdrawn. Stahl v. Van Vleck, 18 M. R. 231, 



84 MORRISON'S OIL RIGHTS 

53 Ohio 136, 41 N. E. 35. Where lessee plugged the well after 
striking gas in connection with delay to work, held grounds to 
cancel the lease. Gadbury v. Ohio, etc., Gas Co., 162 Ind. 9, 62 
L.R.A. 895, 67 N. E. 259, 22 M. R, 680. 

Commencing to Drill. 

Where the lease required that drilling operations should be 
commenced within certain time, the bringing of lumber on the 
premises and installing a derrick, were held good compliance 
with the condition, the starting of actual drilling within the time 
not being essential. Fast v. Whitney (Wyo.) 187 Pac. 192, cit- 
ing Henderson v. Ferrell, 183 Pa. 547, 38 Atl. 1018, 19 M. R. 
205; Fleming Oil & Gas Co. v. South Penn Oil Co., 37 W. Va. 
645, 17 S. E. 203 and Hudspeth v. Producers Oil Co., 134 La. 
1013, 1018, 64 So. 891. Gonzales v. Cowerd, 188 Pac. 1053 
(Okla.) 

Failure to begin work is the same as ceasing to operate. Wood- 
ivard v. Mitchell, 18 M. R, 158, 140 Ind. 406, 39 N. E. 437. 

A covenant to commerce drilling within a fixed period is not 
performed by starting work and then indefinitely suspending it. 
McNish v. Stone, 17 M. R. 22, 152 Pa. 457, 25 Atl. 732 note. 

Point of Sinking. 

The tenant will not be allowed to arbitrarily select a spot to 
sink where it would be a serious inconvenience to the lessor when 
other spots close by are equally available. Gillespie v. American 
Zinc, etc., Co., 247 Pa. 222, 93 Atl. 272; Gulf Pipe Line Co. v. 
Pawnee-Tulsa P. Co., 34 Okla, 775, 41 L.R.A. (N.S.) 1108, 127 
Pac. 252. 

Oral testimony is admissible to point out the place where and 
the time when, under the contract, a well was .to be brought in. 
White v. Kroeger (Okla.) 186 Pac. 477. 

Diligence. 

What is due diligence is a question of fact for the jury. Day 
v. Kansas City Pipe Line Co., 87 Kan. 617, 125 Pac. 43; Buffalo 
Valley Oil & Gas Co. v. Jones, 75 Kan. 18, 88 Pac. 537; 



LEASE — COVENANT TO SINK 85 



Excuse for Delay. 



Delay to commence a well may be explained by consideration 
of the accidents of the business, means of transportation and 
other incidents. And may or may not be sufficient excuse ac- 
cording to the facts. Price v. Black, 126 Iowa, 304, 101 N. W. 
1056; Chandler v. French, 73 W. Va. 658, L.R.A.1915B, 561, 81 
S. E. 825. • 

In Baldwin v. Blue Stem Oil Co. (Kan.) 189 Pac. 920, a suit to 
cancel oil and gas leases for failure to drill or pay within a three 
year period, the defendants attempted to excuse delay on ac- 
count of excessive rainfall and an untimely blizzard, the sick- 
ness of their employees and the war interference with the coal 
supplies. But the Court held that the receiver was bound to 
take notice of climatic conditions and that he was further 
bound to take notice of the war power of the government. 

Where the lease was on undeveloped ground, the fact that 
lessee delayed a short time while other test wells were sinking 
in the neighborhood was natural and sensible under the circum- 
stances. Washburn v. Gillespie, 261 Fed. 41. 

Working other wells in the neighborhood and want of trans- 
portation facilities is no excuse for breach of covenant for steady 
work. Woodward v. Mitchell, 140 Ind. 406, 39 N. E. 437, 18 M. 
R, 158. 

On the question of diligence, the activity of oil and gas wells 
in the locality was considered hi Buffalo V alley Oil & Gas Co. v. 
Jones, 75 Kan. 18, 88 Pac. 537. 

An oil lease contains an implied covenant to keep diligently 
at work, but a cessation of work and even removal of machinery, 
on good reasons therefor, is not necessarily a breach of this cove- 
nant. On the facts set forth in the opinion it was held that there 
was no breach. Phillips v. Hamilton, 17 Wyo. 41, 95 Pac. 846. 

Covenant Runs with the Land. 

The covenant to sink a well is a covenant running with the 
land — and this rule was applied to the implied covenant to sink 
wells enough to protect against drainage. Bradford Oil Co. v. 
Blair, 113 Pa. 83, 57 Am. Rep. 442, 4 Atl. 218. 



86 MORRISON'S OIL RIGHTS 

Danger of Drainage. 

The fact that oil is being drained from the premises by wells 
in the neighborhood is a fact that tends to prove the allegation 
of neglect of the lessee to operate the ground with diligence. 
Brewster v. Lanyon Zinc Co., 140 Fed. 801, 72 C. C. A. 213. 

Business Judgment 

AVhere in the keeping of his working covenants, business judg- 
ment is required of the lessee, if he exercises such judgment in 
good faith it cannot be questioned by the lessor. Colgan v. Forest 
Oil Co., 194 Pa. 234, 75 Am. St. Rep. 695, 20 M. R. 338, 45 Atl. 
119 ; Kellar v Craig, 126 Fed. 630, 61 C C. A. 366. Both these 
cases are cited in Brewster v. Lanyon Zinc Co., 140 Fed. on 
page 813, 72 C. C. A. 213 and declared "unsound" — but the 
criticism digresses from the point decided, which is the use of 
business judgment, and loses itself in a definition of what 
amounts to reasonble diligence. 

Lessor Attempting to Break Lease. 

Where the lessor has attempted by legal proceedings to break 
the lease, he cannot complain of lessees delay excused by such 
proceeding. Blodgett v. Lanyon Zinc Co., 120 Fed. 893, 58 
C. C. A. 79; Bradford Oil Co. v. Blair, 113 Pa. 83, 57 Am. 
Rep. 442, 4 Atl. 218 ; Brewster v. Lanyon Zinc Co., 140 Fed. 801 
(815), 72 C. C. A 213. And the same if he has repudiated the 
lease and forbids the tenant to enter on the premises. La 
Fayette Gas Co. v. Kelsay, 164 Ind. 563, 74 N. E. 7; Consumers' 
Gas Trust Co. v. Worth, 163 Ind. 141, 71 N. E. 489. 

Waiver of the Covenant. 

In Keen v. Logan, 84 So. 501, 147 La. — , the point is con- 
sidered as to the effect of suit brought by the plaintiff, to ex- 
cuse the performance of the promises of the defendant ; Holding 
that the time be suspended until final determination of the suit. 
The decree is in accord with the doctrine that a party is not in 
default for nonperformance of the obligation so long as the 
other party refuses to permit a performance of the obligation. 






LEASE COVENANT TO SINK 87 

Where the lessor told the lessee that a drilling on adjacent 
premises satisfied him and that he would not ask for the lease 
money there was no estoppel because it did not appear that the 
lessee or his assignee, had acted on the statement. Roive v. 
Atlas Oil Co., 84 So. 485, 147 La. — . 

Work and development are not implied where a valid present 
consideration has been paid for the lease. Chandler v. Hart, 161 
Cal. 405, Ann. Cas. 1913B, 1094, 119 Pac. 516. An acceptance 
of delay rental is a waiver of covenant to drill, for the year. 
Consumers' Gas Trust Co. v. Worth, 163 Ind. 140, 71 N. E. 489; 
Consumers' Gas Trust Co. v. Littler, 162 Ind. 320, 70 N. E. 363. 

When a lessor has accepted delay rentals for years, he cannot 
suddenly require sinking on notice of a few days. Consumers' 
Gas Trust Co. v. Littler, 162 Ind. 320, 70 N. E. 363 ; Consumers' 
Gas Trust Co. v. Worth, 163 Ind. 141, 71 N. E. 489; Consumers' 
Gas Trust Co. v. Crystal Window Glass Co., 163 Ind. 190, 70 N. 
E. 366; Consumers' Gas Trust Co. v. Ink, 163 Ind. 174, 71 N. E. 
477. 

Wildcat. 

The strict rule as to development does not apply to Wild Cat 
Territory. Lone Star Gas Co. v. McCullough (Tex. Civ.) 220 
S. W. 1114. 



CHAPTER 20. 

LEASE. NUMBER OF WELLS. PROTECTION. 

Number of Wells. 

Any covenant expressed or implied to sink at all, means at 
least one well and the doctrine of protection may extend the 
number of wells indefinitely. 

If the first hole is dry, the lessee may sink a second. When 
he has sunk one producing well, some of the cases hold that he 
must continue to sink as many as is necessary to develop the 
property. Daugheteer v. Ohio Oil Co., 263 111. 518, 105 N. E. 
308 ; Chandler, v. Hart, 161 Cal. 405, Ann. Cas. 1913B, 1094, 119 
Pac. 516, but even if under implied covenant to sink more than 
one well, breach of such covenant does not justify the cancella- 
tion of the lease. McGraw O. & O. Co. v. Kennedy, 65 W. Va. 
595, 28 L.R.A.(N.S.) 959, 64 S. E. 1027; Carr v. Huntington, 
etc., Co., 33 Ind. App. 1, 70 N. E. 552. Without deciding that 
plaintiff was entitled to forfeiture at all, it was held that it was 
not enforceable without demand upon the lessee to sink the fur- 
ther well. Dinsmoor v. Combs, 111 Ky. 740, 198 S W. 58. 

Where the lease does not fix the number of wells to be drilled, 
the lessee has the right to determine the number. Gilbert v. 
Bolds, 62 Ind. App. 595, 113 N. E. 379. The Court in this deci- 
sion adopts the same rule as in the case where the question of 
paying quantities is concerned. 

When a lessee has paid a bonus and covenanted to sink one 
well which he does — he has earned the right to the full term of the 
lease and is not impliedly bound to keep on further attempts 
to find oil. Key v. Big Sandy, etc., Co. (Tex. Civ.) 212 S. W 
300; O'NeU v. Sun Co. (Tex. Civ.) 123 S. W. 172. 

A lessee is not bound to sink a second gas well when there is 
danger of destroying the yield of the first. Mcknight v. Manu- 

88 



LEASE — NUMBER OF WELLS 89 

facturers N. G Co., 146 Pa. 185, 28 Am. St. Rep 790, 23 Atl. 164, 
17 M. R. 429. 

A lessee obliged to drill lias the right to sink a second well 
when the first proves dry. Henne v. South Penn Oil Co., 52 W. 
Va. 192, 43 S. E: 147; Monroe v. Armstrong, 96 Pa 307; Aye v. 
Philadelphia Co, 193 Pa. 451, 74 Am St. Rep. 696, 44 Atl. 555, 
20 M. R. 177. 

Jury Question. 

Where a written lease was not clear as to how many wells 
were to be sunk, the question of the intention of the parties is 
for the jury. Kirlicks v. Texas Co. (Tex. Civ.) 201 S. W. 687. 

The lessee was to sink seven wells — each within "sixty days 
from the completion of the last one," and in default of such sink- 
ing, an acreage rental was to be paid. More than seven wells 
were sunk. It was held that no rental was demandable for delay 
in sinking the extra wells. Stahl v. Illinois Oil Co., 45 Ind. App. 
211, 90 N. E. 632. A somewhat similar case is Decker v. Kirlicks 
(Tex.) 216 S. W. 385. 

Keeping on to Second Sand. 

Where oil or gas is discovered in an upper sand and drilling 
is continued in search of oil or gas in the lower sand, the lessee 
does not lose his rights by the continued drilling. But if nothing 
be found in the lower stratum, he cannot further delay produc- 
ing the mineral found in the upper stratum. Eastern Oil Co. 
v. Coulehan, 65 W. Va. 531, 64 S. E. 836. 



CHAPTER 21. 

LEASE. PAYING QUANTITIES. 

The term of almost every oil and gas lease reads to continue 
as long as oil or gas is found in paying quantities or as long as 
oil is produced or in words of like meaning. 

Paying Quantities Denned. 

Paying quantities is considered and defined in Ay cock v. Par- 
affine Oil Co. (Tex. Civ.) 210 -S. W. 851, making a distinction 
when the question of sinking other wells is involved. It has dif- 
ferent meanings when involved with the special terms of the 
lease. Ordinarily the original cost of the well is not to be con- 
sidered. Ardizonne v. Archer (Okla.) 178 Pac. 263; Lowther 
Oil Co. v. Miller Sibley Oil Co., 53 W. Va. 501, 97 Am. St. Rep. 
1027, 44 S. E. 433, 22 M. R. 656. But even a small profit may be 
enough. Young v. Forest Oil Co., 194 Pa. 243, 45 Atl. 121, 20 
M. R. 345. 

The Court construes the phrase "paying quantities" in connec- 
tion with the other clauses and in a long lease where no well has 
ever been sunk the payment of rent does not save the term to 
reach the paying quantity period. Indiana Natural Gas, etc., 
Co. v. Grainger, 33 Ind. App. 559, 70 N. E. 395; American Win- 
dow Glass Co. v. Indiana, etc., Oil Co., 37 Ind. App. 439, 76 N. 
E. 1006. 

A party may define a paying well as one producing so many 
barrels per day — and he will be held to that definition altho with 
a smaller production the well was a paying well. McLean v. 
Kishi (Tex. Civ.) 173 S. W 502. 

A covenant to sink a well to "success" is not complied with 
when oil is struck but not pumped to surface. Lessees declara- 
tion that oil had been found in paying quantities does not prove 
such allegation to be a fact. Kennedy v. Crawford, 138 Pa. 561. 

90 



LEASE— PAYING QUANTITIES 91 

How Determined. 

Where the lease called for a second well only if oil or gas 
is found in paying quantities in determining that issue, the cost 
of the original well is to be considered. Manhattan Co. v. Car- 
rell, 164 Ind. 526. 

On the issue of paying quantity, the productivity of neigh- 
boring wells and the evidence of experts is admissible. Osburn 
v. Finkelstein (Ind.) 126 N. E. 11. 

Evidence that many wells had been sunk in the locality and 
only a trace of oil found is proof on the issue of paying quan- 
tities. Bice v. Ege, 42 Fed. 661, 16 M. R. 179. 

In lams v. Carnegie N. Gas Co., the phrase was "if gas be 
found in sufficient quantities to justify marketing" — it was held 
that the operator was not bound to work at a loss but if after 
considering the expense of marketing and all other incidents, it 
would pay, he was liable. 194 Pa. 72, 45 Atl. 54, 20 M. R. 335. 

Cost of First Well When Material. 

It would seem obvious without any decision that where the 
paying quantity clause is considered merely in connection with 
the duration of the term, the cost of sinking the well or wells 
cuts no figure. The issue is, can the well be worked at a profit 
over current expenses. But when the answer to the question 
is, to determine whether the lessee is to sink more wells, to per- 
form his duty to protect the ground, all previous expenditures 
in sinking must be taken into account. But the cases cited in 
this chapter fully sustain this proposition. 

Lessee to Decide. 

The determination of paying quantities as a fact as a rule is 
left solely to the lessee, acting in good faith. Barbour, etc, Co. 
v. Tompkins, 81 W. Va. 116, 93 S. E. 1038; Hennessy v. Junction 
etc., Oil Co. (Okla.) 182 Pac. 666; Young v. Forest Oil Co., 194 
Pa. 243. 45 Atl. 121, 20 M. R. 345; Osburn v. Finkelstein (Ind.) 
126 N. E. 11; Lowther Oil Co. v. Miller Sibley Oil Co., 53 W. 
Va. 501, 97 Am. St. Rep. 1027, 44 S. E. 433, 22 M. R. 656. 

It is for the lessee, not for the lessor, acting in good faith to 



92 MORRISON'S OIL RIGHTS 

say whether gas is being produced in paying quantity. McGraw 
Oil & Gas Co. v. Kennedy, 65 W. Va. 595, 28 L.R.A.(N.S.) 959, 

64 S. E. 1027; Summerville v. Apollo Gas Co., 207 Pa. 334, 56 
Atl. 876. But he cannot act arbitrarily contrary to the conceded 
facts concerning production. Daughetee v. Ohio Oil Co., 263 111, 
518, 105 N. E. 308. And his judgment is not to be attacked, ex- 
cept on the allegation of fraud which must be pleaded. Man- 
hattan Oil Co. v. Carrvll, 164 Ind. 526, 73 N. E. 1084. 

Where the lessee was to pay a certain rent if gas was found 
and the lessee was willing to pay the rent, it was not for the 
lessor to refuse it and forfeit the lease, because, as he alleged it 
was not in paying quantity. McGraw Oil & Gas Co. v. Kennedy, 

65 W. Va. 595, 28 L.R.A.(N.S.) 959, 64 S. E. 1027. 

Where a lease ran for two years with the paying quantities 
clause, it ensued that an immense flow of gas was struck, but for 
want of a purchaser it was not utilized, so that no profit came to 
either party from the gas. The Court held that the assertion of 
the lessor that paying quantities had not been found, was untena- 
ble under such facts. Summerville v. Apollo Gas Co., 207 Pa. 
334, 56 Atl. 876. 

Effect on Term of Lease. 

Where there is a fixed term and the paying quantities clause 
also the paying quantity clause does not begin to operate if nei- 
ther oil nor gas was found during the time limited. Cooke v. 
Gulf Ref. Co., 127 La. 592, 53 So. 874. 

When the time limit of the lease expires and oil has not been 
found in paying quantities the use of these words does not extend 
the term. Chaney v. Ohio, etc., Oil Co., 32 Ind. App. 193, 69 
N. E. 477 ; Western Pennsylvania Gas Co. v. George, 161 Pa. 47, 
28 Atl. 1004; Brown v. Fowler, 65 Ohio St. 507, 63 N. E. 76; 
Cassell v. Crothers, 193 Pa. 359, 44 Atl. 446, 20 M. R. 160; 
Cooke v. Gulf Ref. Co., 127 La. 592, 53 So. 874; Shellar v. Shiv- 
ers, 171 Pa. 569, 33 Atl. 95, 18 M. R. 260; Western Pennsylvania 
Gas Co. v. George, 161 Pa. 47, 28 Atl. 1004. 

A lease was for a fixed term and "as long thereafter as oil is 
found in paying quantities." Oil in paying quantities was found 
The Court held that after the end of the fixed term and after 



LEASE — PAYING QUANTITIES 93 

the wells had ceased to 3'ield oil in paying quantities the lessee 
was a tenant at will and either party had the right to declare; 
the term ended. Cassell v. Crothers, 193 Pa. 359, 44 Atl. 446, 
20 M. R. 160. 

Fall in the price of oil is no defense to the covenant to operate. 
The case seems to imply that the paying quantities term ends 
in such case the same as if no oil had been found. Collins v. 
Mi. Pleasant 0. & G. Co., 85 Kan. 483, 38 L.R.A.(N.S.) 134, 118 
Pac. 54. 

The paying quantities clause will not enlarge the term beyond 
the fixed period where the proof shows the well sunk was only 
a small producer and during the five years of the term no sub- 
stantial effort had been made to develop the, property. Barns- 
dall v. Boley, 119 Fed. 191. 

Two Flows Struck. 

Where the well struck gas in paying quantities, but was con- 
tinued deeper and struck more gas, the lessee did not lose his 
rights by casting off the first flow. He had the right to go back 
and later use the upper flow. Roach v. Junction, Oil, etc., Co. 
(Okla.) 179 Pac. 934. 

Lessee Not Bound to Shoot. 

A lessee is not bound to shoot a well to show whether it may 
be made to produce in paying quanties. Rice v. Ege, 42 Fed. 
661, 16 M. R. 179. 



CHAPTER 22. 

LEASE. THE RENTS AND ROYALTIES. 

'A covenant to pay periodical rent as the sole consideration 
for the lease, such as is reserved in the lease of a dwelling, is 
not usual. Such a reservation would be perfectly valid, but the 
surrounding conditions of the demise, suggest a royalty, which 
is in fact a rent based on the hazard of the adventure. 

The rent most common is one based on provisions for exten- 
sions of time or as damages for delay to start work. 

"In mining leases these words 'Rent' and 'Royalty' are used 
interchangeably to convey the same meaning" Nelson v. Re- 
public Iron, etc., Co., 240 Fed. 285, 293, 153 C. C. A. 211. 

Covenant Runs- with the Land. 

The royalty covenant is a covenant running with the land. 
Stone v. Marshall Oil Co., 188 Pa. 602, 41 Atl. 748, 1119, 19 M. 
R. 593. Edmonds v. Mounsey, 18 M. R. 384, 15 Ind. App. 399, 
44 N. E. 196; Pierce Fordyce Oil Assn. v.Woodrum (Tex. Civ.) 
188 S. W. 245. 

Delay Rentals. 

The question of the sufficiency of the original consideration is 
eliminated by the payment of a delay rental. McKay v. Tally, 
220 S. W. 167 (Tex. Civ.). 

Royalty is the substantial consideration in an oil lease and 
not the delay rentals. Stahl v. Illinois Oil Co., 45 Ind. App. 
211, 90 N. E. 632; Gadbury v. Ohio, etc, Gas- Co., 162 Ind. 9, 
62 L.R.A. 895, 67 N. E. 259, 22 M. R, 680. 

Altho royalty is of the essence of oil and gas leases parties 
have the right to so word the lease as to delay it for a long time 
and where such time is expressed, lessor has no right to demand 

94 



LEASE RENTS AND ROYALTIES 95 

immediate performance. Ringle v. Quigg, 74 Kan. 581, 87 Pac. 
724. 

Delay rentals are payable in advance. Bill v. Fraze, 169 Ind. 
53, 79 N. E. 971. 

Where money is due 10 days after a certain date the day of 
such date is excluded. White v. Dennis, 220 S. W. 161 (Tex. 
Civ.) 

Where the $1 consideration gives the right to pay a delay 
rental, no rent is payable for the first year. Sullivent v. Clear 
Creek Oil, etc., Co. (Ark.) 211 S. W. 173. 

Lease. 

The burden of proof of payment of delay rental is on the 
lessee. Pure Oil Operating Co. v. Gulf Ref. Co., 143 La. 284, 
78 So. 560. 

The right to pay delay rentals does not extend beyond the 
fixed term of the lease. Bettman v. Harness, 42 W. Va. 433, 36 
L.R.A. 566, 26 S. E. 271, 18 M. K 500. 

The commencement of a well is not a condition precedent to 
the right to pay a delay rental. Caber v. Hauser (Okla.) 185 
Pac. 436. Lessee agreed to pay at the rate of $1,000 per annum 
for delay in sinking. The Court distributed the damages by 
dividing the lump sum by the number of months of the default. 
Galey v. Kellerman, 17 M. R. 164, 123 Pa, 491, 16 Atl. 474. 

The lessees had three months to complete the well and for five 
months after this period elapsed they remained in possession 
so that the Court allowed a recovery of 5/12 of $1000. 

Right of Action for Rent. 

The privilege to the lessee to secure further time to sink by 
paying a rental is an option only and his failure to pay, gives 
no right of action for such rent. United States v. Comet Oil, 
etc., Co., 187 Fed. 674; Hays v. Forest Oil Co., 213 Pa. 556, 62 
Atl. 1072. 

Where lease provides that failure to work will render the lease 
null and. void, this does not restrict the lessor to the right to 
terminate the lease, but gives him only an option so to do and he 
may have his action for the rent or for the delay in sinking. 



96 MORRISON'S OIL RIGHTS 

Allen v. Narver, 178 Cal. 202, 172 Pac. 980, nor does the right 
to surrender destroy the right to sue for the rent. McKee v. 
Grimm, 57 Okla. 680, 157 Pac. 308. 

Under a lease calling for a monthly rental, until a well is com- 
pleted, or until the end of a fixed term, the lessee is bound for 
such rental, altho he never completes any well. Lawson v. Kirch- 
ner, 50 W. Va. 344, 40 S. E. 344, 21 M. R. 683. 

A clause in a lease was to pay a certain sum within a fixed 
period after a well was sunk and gas found — the lessee was 
bound to sink the well and became absolutely liable on failure 
to sink. Washington Natural Gas Co. v. Johnson, 123 Pa. 576, 
10 Aim St. Rep. 553, 16 Atl. 799, 16 M. R. 165. 

Periodical Rent. 

A lease requiring a well to be sunk within a fixed time, or in 
default of sinking reserving an annual rent, with a right to 
reconvey to the lessor is a lease at an annual rent at the option 
of the lessee only, and not a lease at will to either party. Cen- 
tral Ohio Natural Gas & Fuel Co. v. Eckert, 70 Ohio 127, 71 
N. E. 281. 

The agreement to receive an annual rent is a continuing offer 
by the lessor and it cannot be withdrawn without notice and op- 
portunity to perform. McKay v. Tally, 220 S. W. 167 (Tex. 
Civ.) 

Upon a somewhat similar lease it was held that the lessor at 
his election could sue for the rent, or for failure to drill. Wood- 
land Oil Co. v. Crawford, 55 Ohio 161, 34 L.R.A. 62, 44 N. E. 
1093. 

A rent payable annually is not payable in advance. It may 
be paid any time during the year. Rhodes v. Mound City Gas, 
etc., Co., 80 Kan. 762, 104 Pac. 851. Blodgett v. Lanyon Zinc 
Co., 120 Fed. 893, 58 C. C. A. 79. 

In Arnold v. Gamett L. & F. Co., 103 Kan. 166, 172 Pac. 1012, 
the lease ran for two years with the right to extend it to 50 years 
if an annual acreage rent was paid and the lease was held un- 
impeachable. 



LEASE RENTS AND ROYALTIES 97 

Payment or Tender. 

An oil lease for $1 consideration provided for sinking- well 
within two years with a proviso that forfeiture might be avoided 
by paying $18.75 per annum, nntil the well was completed — held 
to create a lease until the well was completed. Lowther Oil Co. 
v. Guffey, 52 W. Va. 88, 43 S. E. 101, 22 M. R, 545. But such 
a lease does not give the right to delay sinking indefinitely and 
the lease was upheld, because the lessee was diligently engaged 
in drilling. «, 

Where there are two lessors payment to either is good. Jens- 
Marie Oil Co. v. Eixse (Okla.) 178 Pac. 658. 

When the lessor refuses to accept the delay rental, the lessee 
must start operations within a reasonable time, the opinion as- 
suming that lessor had the right to refuse the delay rentals. 
Consumers' Gas Trust Co. v. Worth, 163 Ind. 141, 71 N. E. 489. 

The royalties are the main consideration and lessee cannot 
delay work indefinitely on payment of the small rent reserved. 
But the lessor cannot avoid the lease by abruptly refusing to 
accept further rents, and it having been tendered for the second 
year the lease was saved from forfeiture. Warren Oil & Gas 
Co. v. Gilliam, 182 Ky. 807, 207 S. W. 698. 

Payment by Deposit or Check. 

Deposit of rent money in bank is good tender when the lessor 
is notified of the deposit and refuses to accept on other grounds. 
Gillespie v. Fulton Oil & G. Co. 236 111. 188, 86 N. E. 219. 

When payment of bank deposit was allowable, but not made 
in time, the lessor is bound only to notify the depositor; he is 
not bound to see the deposit returned. Pure Oil Operating Co. 
v. Gulf Ref. Co., 143 La. 284, 78 So. 560. * 

Where the bank is the lessees agent to receive deposits of 
rentals, the lessee is not responsible for the banks wrongful im- 
position of conditions on the tender of the deposits. Lovett v. 
Eastern Oil Co., 68 W. Va. 667, Ann. Cas. 1912B, 360, 70 S. E. 
707. The bank has no authority to extend the time. Mitchell 
v. Probst, 52 Okla, 10, 152 Pac. 597, 599. 

Leaving check at the bank designated as the place of payment 
M. O. E.— 7. 



98 MORRISON'S OIL RIGHTS 

of delay rentals is good payment. Sayers v. Rent, 201 Pa. 38, 
50 Atl. 296 ; Monfort v. Lanyon Zinc Co., 67 Kan. 310, 72 Pac. 
784; Gillespie v. Fulton Oil & G. Co., 236 111. 188, 86 N. E. 219; 
La Fayette Gas Co. v. Kelsay, 164 Ind. 563, 74 N. E. 7; Indiana 
Natural Gas, etc., Co. v. Seals, 166 Ind. 684, 76 N. E. 520. 

Where tenders of rent are made and refused for reasons un- 
related to such rentals, further tenders of rent are unnecessary. 
Wright v. Gillespie, 261 Fed. 46. 

Where the bank is his designated agent, payment to the bank 
is the same* as payment to the lessor and no defaults of the 
bank are chargeable to the lessee. Hunter v. Gulf Prod. Co., 
(Tex. Civ.) 220 S. W. 163 ; McKay v. Tally (Tex. Civ.) 220 S. 
W. 167. 

Instructions to the bank to refuse payment of which the 
lessees had no notice do not bind them. McKay v. Kilcrease, 
(Tex. Civ.) 220 S. W. 177 and McKey v. Tally (Tex. Civ.) 220 S. 
W. 167. 

The return of a check marked refused is sufficient proof of 
tender. Lone Star Gas Co. v. McCulloitgh{Tex. Civ.) 220 S. W. 
1114. 

Payment to Wrong Party. 

A lessee who through mistake paid the rent to the lessor 
instead of the assignee (altho aware of the assignment) is en- 
titled to relief against his default. Brunson v. Carter Oil Co., 
259 Fed. C56. 

Lease Repudiated. 

Where a lessor has repudiated the lease the tender of perform- 
ance in lessee's bill for relief is a sufficient tender of any rentals 
called for by the lease. GiUespip r. Fulton Oil & G. Co., 236 
111. 188, 86 N. E. 219. 

Where the lessee had the right to a renewal after he paid the 
minimum royalty and the lessor had given notice that he would 
j lot renew, the lessor could not enforce demand for the payment 
of such royalty having repudiated its consideration. Warner 
v. Cochrane, 128 Fed. 553, 63 C. C. A. 207. 



LEASE RENTS AND ROYALTIES 99 

When lessor gives notice that he will not accept the money 
the tender of the mone}^ is waived. White v. Dennis, 220 S. W. 
161 (Tex. Civ.). 

Demand or Notice, When Required. 

Lessee maj^ not by paying* nominal rent be allowed to extend 
the lease indefinitely, but after receiving rent lessor must notify 
of his intent to refuse further payments. Ohio Valley Oil & 
Gas Co. v. Irvine Dev. Co., 184 Ky. 517, 212 S. W. 110. 

Where the lease provided that lessee should sink a well which 
he did, but it proved dry, the contract providing for an acre- 
age rent if he failed to drill, he does not become liable for such 
rent by breach of a technical covenant to give notice of the 
failure of the well. May v. Hazelwoocl Oil Co., 152 Pa. 518, 25 
Atl. 564. 

Royalty Treated as Purchase Money. 

A demise of all the coal for ninety-nine years at a fixed royalty 
constituted a sale of the coal and the rents after the death of the 
grantor were payable as purchase money to his administrators 
and distributable as personal property. In re estate of LaMrus, 
145 Pa. 1, 23 Atl. 372. 

Use of Oil or Gas in Operating. 

It is the general custom that oil gas or coal extracted from the 
leased premises used in operating, is not chargeable with pent 
or royalty. Prichard v. Freeland Oil Co., 75 W. Va. 450, L.R.A. 
19151) 1186, 84 S. E. 945. But a clause allowing free gas for 
such use will not allow use of gas beyond its express terms. 
Ohio Oil Co. v. Bur eh (Ind. App.) 124 N. E. 781. 

The lessee has the right to place a meter to measure the free 
gas and the lessor has no right to unrestrained use of the gas. 
Pittsburgh, etc., Gas Co. v. Richardson (W. Va.) 100-S.'E. 220. 

Where the lessee was to furnish gas as part of the considera- 
tion of the lease the furnishing of gas from wells on other 
ground was not a part performance of the condition of the lease. 



100 MORRISON'S OIL RIGHTS 

Hancock v. Diamond Plate Glass Co., 37 Incl. App. 351, 75 N. E. 
659. 

Pending Litigation. 

In Myers v. Shertzer (Shertzer v. Myers) 82 Kan. 275, 103 
Pac. 105, the lessee was held for rent accruing during pendency 
of a suit by which the lessor was trying to break the lease; the 
lessee failing to offer to surrender as he had the power to do 
under the lease. 

In the opinion the Court uses the expression: "A man is 
not bound to succeed in every legal action he commences," which 
is a truism but a severe penalty was placed on the lessee in 
this case practically because he did not surrender his rights 
and his hope of profit at the outstart. 

Recovery Back. 

Rent paid without knowledge of defective title may be re- 
covered back — otherwise if the tenant knew the facts. Gaffney 
v. Stoivers, 73 W. Va. 420, 80. S. E. 501. 

When Rent Ceases. 

Where the lease calls for rent after gas is found in paying 
quantities, such rent ceases when the well is exhausted or aban- 
doned. Williams v. Guffey, 18 M. R, 478, 178 Pa. 342, 35 Atl. 
875; Indianapolis Gas Co. v. Teters, 15 Ind. App. 475, 44 N. E. 
549, 18 M. R, 391. 

Lessors Title Extinguished. 

Lessee on being sued for royalty, may show that his lessor's 
title has been extinguished. Stem v. Kemp (Okla.) 186 Pac. 
946. 

Royalty as Property. 

The ownership in the royalty has been considered in a few 
cases distinct from its relation as a debt against the lessee. 
A percentage of the net profits of a mine is a royalty and is 



LEASE RENTS AND ROYALTIES 101 

rents and profits from real estate. Minnesota Loan <£• T. Co. v. 
Douglas (Pettifs Estate) 135 Minn. 413, 161 N. W. 158. A 
grant of the royalty is a grant of the oil itself. Paxton v. Bene- 
dum-Trecs Oil Co., 80 W. Va. 187, 94 S. E. 472, Overruling If ar- 
ris v. Cobb, 49 W. Va. 360, 38 S. E. 559, 21 M. R. 263. 

Oil royalty is personal property and a bill in chancery will lie 
for its partition. Warren v. Boggs (W. Va.) 97 S. E. 589. 

The percentage of oil royalty to be paid or delivered is the 
property of the lessee. Coalinga Pacific Oil <£• Gas Co. v. Asso- 
ciated Oil Co., 16 Cal. App. 361, 116 Pac. 1107. 

A contract for the total "production" of the well includes the 
royalty. Coalinga Pacific Oil & Gas Co. v. Associated Oil Co., 
16 Cal. App. 361, 116 Pac. 1107. 

By-Products. 

Where the lessee provides appliances (the vacuum pump pro- 
cess) by which the casing head gas is advanced to gasoline he is 
liable for royalty on the product the same as on the natural 
crude oil. Wemple v. Producers Oil Co., 145 La. 1031, 83 So. 
232; Locke v. Russell, 75 W. Va/602, 84 S. E. 948. 

The Louisiana case suggests that a part of the oil which was 
liable for royalty was converted into vapor and thus advanced 
to gasoline. The West Virginia case treats the vapor as some- 
thing that unless treated as it was was a waste product. 

Division of Royalties. The Wettengel Case. 

In the case of Wettengel v. GonnJey, 160 Pa. 559, 40 Am. St. 
Rep. 733, 28 Atl. 934, 18 M. R. 93, the owner gave a fifteen year 
oil lease on his farm of about 60 acres. At his decease the farm 
by will was cut up into three nearly equal tracts and came by 
devise to his three children, one to each in severalty. Pay wells 
had been drilled on one of these farms covered by the lease, and 
none on the other two. The Court ruled that each of the three 
owners was entitled to share in the royalty, according to the 
acreage of his farm. On a second suit this division was adhered 
to. 184 Pa. 364, 39 Atl. 1118. 

The opinions in these cases have been followed but more 



102 MORRISON'S OIL RIGHTS 

often dissented from. It is expressly disapproved in North- 
western Ohio Natural Gas Co. v. Ullery, 68 Ohio St. 259, 67 N. 
E. 494, and in Rymer v. South Penn Oil Co., 54 W. Va. 530, 46 
S. E. 559. In Lynch v. Davis, 79 W. Va. 437, L.R.A.1917F 566, 
92 S. E. 427, the .West Virginia Court without mention of their 
previous decision in the Rymer case approve of it. In the still 
later case of Pittsburgh, etc., Gas Co. v. Anhrom, 83 W. Va. 81, 
97 S. E. 593, they returned to their original ground and over- 
ruled the Lynch case. In Kimbley v. Luckey (Okla.) 179 Pac. 
928, a quarter section covered by an oil and gas lease had been 
subdivided. The Court strongly refer to the "interminable con- 
fusion" that would result from allowing each acre to share in its 
proportion of the royalty. To the same effect are Fairbanks v. 
Warrum, 56 Ind. App. 337, 104 N. E. 938, 1141, and Osborn v. 
Arkansas, etc., Oil Co., 103 Ark. 175, 146 S. W. 122, and the late 
case of Pierce Oil Corp. v. 8 chacht (Okla.) 181 Pac. 731, but 
Gillette v. Mitchell (Tex. Civ.) 214 S. W. 619, follows the Wet- 
tengel case and cites the cases where it had been endorsed or 
repudiated. 



CHAPTER 23. 

LEASE. SECOND LEASE. 

First Lease Exclusive. 

As a lease is exclusive aud does uot allow the lessor himself 
to mind the demised tract {Barker v. Dale, 3 Pittsburg 190, Fed. 
Cas. No. 988, 8 M. II. 597) it follows necessarily that what the 
lessor cannot do himself, he cannot allow others to do and there- 
fore a second lease to another party is void as against the first 
lease. 

But the first lessee may have abandoned his term or his lease 
may be subject to forfeiture or his supposed surrender may be 
not admitted or disputable, so that a second lease is not of un- 
common occurrence. 

If the first lease is valid in all respects, the second lessee has 
no rights at all as against the first lessee where the second lessee 
has notice of the first lease. Pyle v. Henderson, 65 W. Va. 39, 
03 S. E. 762. Swan v. O'Bar (Okla.) 167 Pac. 470. The second 
lessee with notice is not a bona fide purchaser. Rader v. Shaffer 
(Ky.) 218 S. W. 292. The second lessee in such case may 
be enjoined and the title of the first quieted. Warren Oil 
<fc Gas Co. v. Gilliam, 182 Ky. 807, 207 S. W. 698 ; Downey v. 
Goorh, 240 Fed. 527. 

The party who takes the second lease with notice of the first 
takes the risk of proving that the first had been abandoned, and 
has been held to be bound by the terms of a parol agreement 
with the first lessee as to what should amount to due diligence 
or abandonment. Bartley v. Phillips, 179 Pa. 175, 36 Atl. 217, 
IS M. R. 542. The second lessee cannot attack the consideration 
of the first lease nor its alleged want of mutuality. Lindlay v. 
lunifhire. 289 Fed. 928 ; Complon v. Peoples Gas Co., 75 Kan. 
572, 10 L.R.A.(X.S.) 787, 89 Pac. 1039. 

103 



104 MORRISON '8 OIL RIGHTS 

The fact that vendor had already sold the mineral rights to a 
third party is no breach of warranty of the same, when the buyer 
knew of such sale. Sanders v. Rowe, 48 S. W. 1083 (Ky.). 

Second Lease Subject to First. 

A second lease may be given subject to the rights of a prior 
lease. Garrett v. South Penn. Oil Co., 66 W. Va. 587, 66 S. E. 
741 ; Cox v. Butts, 48 Okla. 147, 149 Pac. 1090. And when there 
was an agreement to accept a lease when a prior lease should 
have determined, and the prior lease was released, the agree- 
ment became an executed contract, altho not formally signed. 
Haynie v. Stovall (Tex. Civ.) 212 S. W. 792. 

When a lessee accepts a second lease it is a surrender of all 
rights under the first lease. Garrett v. South Penn Oil Co., 66 
W. Va. 587, 66 S. E. 741; Great Western Oil Co. v. Carpenter, 
43 Tex. Civ. 229, 95 S. W. 57. 

Notice of Prior Lease. 

The recital in the papers of a former lease is notice of the 
outstanding lease. Mexico Wyoming Petroleum Co. v. Valentine, 
237 Fed. 539, 150 C. C. A. 421. But where the rights of the 
first lessee have expired, the standing in equity of the second 
lessee may be better than that of the first lessee, altho the first 
lessee had lost his rights by mere mischance. Hopkins v. Zeigler, 
259 Fed. 43, 44. 

The giving of a second lease which recites the fact of lease 
outstanding or claimed so to be, is not a declaration of forfeit- 
ure as to the first lease. Stone v. Marshall Oil Co., 188 Pa. 602, 
41 Atl. 748, 1119, 19 M. R. 593; Henne v. South Penn Oil Co., 
52 W. Va. 192, 43 S. E. 147. 

Whether plaintiff's possession was such as should put a sub- 
sequent lessee on inquiiy was for the jury. Anrelius v. Stewart, 
219 S. W. 863 (Tex. Civ.). 

Sublessee Dealing Underhand with Owner. 

Where the sublessee under a lease compelling the drilling of 
two wells, obtained a lease direct from the owner not requiring 



LEASE — SECOND LEASE 105 

the two wells, held that the second lease was a fraud on the orig- 
inal lessee. Stone v. Marshall Oil Co., 188 Pa. 602, 41 Atl. 748, 
1119, 19 M. R, 593. 

Injunction in Aid of First Lease. 

A suit to enjoin a second lessee, is a suit to prevent trespass 
and the doctrine that equity will not enforce a contract where 
there is no mutuality of rights, does not apply. An oil lessee 
has no adequate remedy at law where a subsequent lessee is 
removing the oil. Lindlay v. Raydure, 239 Fed. 928 ; Guffey v. 
Smith, 237 U. S. 101, 59 L. ed. 856, 35 Sup. Ct. 526, Reversing 
202 Fed. 106, 120 C. C. A. 436. 



CHAPTER 24. 

LEASE. ASSIGNMENT. 

Unless forbidden by his covenant to assign, there being no 
relation of trust and confidence between landlord and tenant, 
the lessee has the right to either assign or sublet, but such as- 
signment does not ordinarily release him from the covenants of 
his lease as the original contracting party with the lessor. 

An oil lease on good consideration and therefore assignable, 
will be upheld as to innocent purchasers without notice of any 
infirmity. McKay v. Lucas, 220 S. W. 172 (Tex. Civ.). 

An oil lessee has the right to sublet in parcels and to subdivide 
the land. The old rule in Lord Mount joy's case, 4 Leon. 147, as 
to surcharging the mines has no application to the conditions 
incident to mining for oil. Chandler v. Hart, 161 Cal. 405, Ann. 
Cas. 1913B 1094, 119 Pac. 516. 

Upon acceptance of the assignment, the assignee becomes 
bound by the covenants of the lease even though he has never 
entered on the land. Edmonds v. Mounsey, 15 Ind. App. 399, 
44 N. E. 196, 18 M. R, 384. This includes the rental covenant. 
Pierce Fordyce Oil Assn. v. Woodrum (Tex. Civ.) 188 S. W. 245, 
but does not cover breaches complete before he purchased. 
Washington Natural Gas Co. v. Johnson, 123 Pa. 576, 10 Am. 
St. Rep. 553, 16 Atl. 799, 16 M. R, 165 ; Cox v. Butts, 48 Okla. 
147, 149 Pac 1090. 

Simms v. Southern Pipe Line Co. (Tex. Civ.) 195 S. W. 283. 
was a suit for specific performance of a contract to sell the pro- 
duct of certain large wells to the plaintiff company. The plain- 
tiff was an assignee of the lease and bought with knowledge of 
its contract with the Pipe Line Compan}^. Specific performance 
w<is denied on the ground that there was adequate relief at law, 
but the material point decided was that the assignee was bound 
by the contract of its assignor. 

106 



leasj:- -assig \ ment 107 

Where a lease contains a covenant against assignment but the 
lessor recognizes the assignee inducing change of his position to 
his prejudice, the lessor is estopped to deny consent to the as- 
signment. Warner v. Cochrane, 128 Fed. 553, 63 C. C. A. 207. 

The fraud in suppression of facts by the lessor or the non- 
payment of a bonus receipted for by him does not affect the 
validity of the lease in the hands of bona fide assignee. Moore v. 
Sawyer, 167 Fed. 826. 

An assignment of all the first party's right, title and interest 
in a lease, where the buyer has knowledge of a previous out- 
standing demise carries no warranty and the buyer takes the 
risk. Tupeker v. Deaner, 46 Okla. 328, 148 Pac. 853. And on 
the peculiar facts of the case in Eastern Oil Co. v. Holcolm, 
212 Fed. 126, 128 C. C. A. 642, there was held to be no war- 
ranty. 

Incidents of Assignment. 

A covenant between the lessee and his assignee is personal and 
does not pass by a transfer of the lease. Millan v. Bartlett, 78 
W. Va. 367, 89 S. E. 711. The assignment does not release the 
tenant from his express covenants. Heller v. Bailey, 28 Ind. 
App. 555, 63 N. E. 490. And on account of the sudden fluctua- 
tions in value of oil leases, time is of the essence in contracts for 
their sale. Kelly v. Marshall, 172 Pa. 396, 33 Atl. 690, 18 M. 
R. 317. And where the lease is in litigation, the buyer takes no 
greater rights than the assignor had at the date of the assign- 
ment. Turben v. Douglas (Okla.) 183 Pac. 881. 

Sublease. 

The sale by the lessee of a gas well, of the gas flowing from it, 
the purchaser being placed in possession, is really a sublease of 
the well. Stone v. Marshall Oil Co., 188 Pa. 602, 41 Atl. 748 ; 
1119, 19 M. R. 593. A sublease is not an encumbrance. Smith 
v. United Crude Oil Co., 179 Cal. 570, 178 Pac. 141. 

Purchase of an undivided interest in the leased premises does 
not necessarily merge the two titles. Patterson v. United Nat- 
ural Gas Co., 263 Pa. 21, 105 Atl. 828. 



10t> MORRISON'S OIL RIGHTS 

An assignment of royalties does not come within the record- 
ing Acts, the royalty being personal property. Farmers & Mer- 
chants State Bank v. Tullos (Tex. Civ.) 211 S. W. 847. 

The sublessees of an oil lease are chargeable with the default 
of the original lessee and can not claim protection as innocent 
purchasers without notice, and are chargeable also with know- 
ledge of the form and effect of the original lease. Hitson v. 
Oilman, 220 S. W. 140 (Tex. Civ.). 



CHAPTER 25. 

LEASE. SURFACE RESERVES. EVICTION. 

An oil lease granting the exclusive right to mine for oil and 
the possession of so much of 430 acres as may be necessary there- 
for, does not give the lessee the right to cultivate, or use for 
residence any part of the land. Fowler v. Delaplain, 79 Ohio 
St. 279, 21 L.R.A.(N.S.) 100, 87 N. E. 260. 

A lease of a 40 acre tract excepting 10 acres on which no oil 
wells were to be sunk gives the lessee the right to the oil under 
those 10 acres and the lessor cannot let them for oil sinking to 
others. Brown v. Spilman, 155 U. S. 665, 39 L. ed. 304, 15 Sup. 
Ct. 245. 

Where by consent of the lessor the lessee drills a well within 
the excepted ground it is the same as if such ground had not 
been excepted. Balfour v. Bensell, 167 Pa. 287, 31 Atl. 570, 18 
M. R. 202. 

"Where the oil lessee was not allowed to use a cultivated en- 
closure, whether the area was in cultivation before the well was 
started was held a question of fact. Barnsdall Oil Co. v. Leahy, 
195 Fed. 7?1, 115 C. C. A. 521. 

In O'Neil v. Sun Co. (Tex. Civ.) 123 S. W. 172, a lease pro- 
vided for the sinking of three wells with the option to the lessee 
to release the unworked premises and where the lessor had him- 
self sunk a well on the demised ground not released, its oil pro- 
duct belonged to the lessee. 

Conveyance of the land by the lessor without reserving lessees 
rights is an eviction and determines the lessees liability for rent. 
Mathews v. People's Natural Gas Co., 179 Pa. 165, 36 Atl. 216, 
18 M. R. 552, 

The commencement of a suit against the lessor does not oper- 
ate as an eviction of the lessee. Commins v. Guaranty Oil Co., 
29 Cal. App. 139, 154 Pac. 882. 

When a second lessee makes his peace with a prior lessee and 
is let into possession, he cannot treat the prior lease as an evic- 
tion by his lessor. Horberg v. May, 153 Pa. 216, 25 Atl. 750. 

109 



CHAPTER 26. 

LEASE. ABANDONMENT. 

The rights of the lessee may be lost by abandonment which is 
practically the same thing as breach of the implied coverant to 
sink, or to work with diligence. 

Abandonment is a question of intention, but this intention is 
constantly proved by necessary inference from Acts : removal of 
machinery and quitting the premises is proof of it. Calhoon v. 
Neely, 201 Pa. 97, 50 Atl. 967, 21 M. R. 754. When the unsuc- 
cessful search for oil is abandoned, tho inchoate title of the 
explorer for mineral is lost. Garrett v. South Penn Oil Co., 66 
W. Va. 587, 66 S. E. 741 ; Eastern Oil Co. v. Coulehan, 65 W. 
Va. 531, 64 S. E. 836. Long delay is proof of abandonment 
which will justify cancellation of the lease. Chandler v. French, 
73 W. Va. 658, L.R.A.1915B 561, 81 S. E. 825; Acme Oil, etc, 
Co. v. Williams, 140 Cal. 681, 74 Pac. 296. The presence of a 
forfeiture clause is not necessary to allow of this result. Smith 
v. Root, 66 W. Va. 633, 30 L.R,A.(N.S.) 176, 66 S. E. 1005. 

Except in the case of a perfect legal title to a corporeal here- 
ditament, every right or interest in, title to, or ownership of 
property may be lost by abandonment. This rule applies to 
mining rights and privileges. Aye v. Philadelphia Co., 193 Pa. 
451, 74 Am. St, Rep. 696, 44 Atl. 555, 20 M. R. 177 ; Wilmore 
Coal Co. v. Brown, 147 Fed. 931, 943, affirmed in Brown v. Wil- 
more Coal Co., 153 Fed. 143, 82 C. C, A. 295; Berry v. Boss, 
5 Colo. 295, 1 M. R. 1. 

In determining whether a lease had been abandoned all the 
facts are to be considered: An unexplained cessation of work 
would be sufficient proof. Strange v. Hicks, 188 Pac. 347 
(Okla.). 

It is a jury question on the issue in ejectment as to whether 
or not a lease had been abandoned. Bartley v. Phillips, 179 

Pa. 175. 

110 



LEASE — AB AN DON MENT 111 

Testifying* to Intent. 

On the issue of abandonment a party may swear to his inten- 
tions in explanation of his acts. Bartley v. Phillips, 179 Pa. 175, 
3«6 Atl. 217, 18 M. R, 542. 

Re-entry Not Allowed. 

Where the lessee has lost his rights by abandonment and lessor 
lias brought suit to quit the title, the lessee by re-entry cannot 
revive his lost rights. Ohio Oil Co. v. Detamore, 165 Ind. 243, 
244, 73 N. E. 906. 

Where an oil lease is abandoned it cannot be renewed without 
the consent of the lessor. A second lease to the same party an- 
nuls the first. Abandonment of oil and gas leases will be more 
readily found than in other instances. Harris v. Biggs, 63 Ind. 
App. 201, 112 N. E. 36. 

Facts Amounting To. 

Where a lease calls for one well which is sunk and breach of 
such covenant is made the sole ground for forfeiture, the Court 
will not make failure to sink a second well a ground of forfeiture 
— but the failure to sink a second well and quitting the premises 
without intention to return is the abandonment of the lease. 
Grubb v. McAfee (Tex.) 212 S. W. 464. 

Lessee under a fifteen year lease sank a dry well, and took 
away his derrick but left the casing. Eleven years after, and 
after a second lease had been let, he re-entered and sank a paying 
well. The Court held that the abandonment was complete and 
should not have been left to the jury, with the usual phrases 
about the distinctions between oil and other leases. Two of the 
judges dissented and on examination of the facts, it will be 
seen that there was plausible excuse for the long delay. The 
Court found that the second lessee also had abandoned and the 
case hinged on side issues between the lessor and the second 
lessee. Gonkling v. Krandusky, 127 App. Div. 761, 112 N. Y. 
Supp. 13. 

Where the lessee sank one dry well, quits operations and makes 
no attempt to further explore, it is an abandonment of the 



112 MORRISON'S OIL RIGHTS 

lease. Foster v. Elk Fork 0. & G. Co., 90 Fed. 178, 32 C. C. A. 
560. 

Millar v. Mauney, 219 S. W. 1028 (Ark.) is a curious ease on a 
lease of a diamond mine where war conditions and harassing the 
lessees by suits and prosecution, were introduced to excuse al- 
leged abandonment. 

In Bois J)' Arc Creek Oil & Gas Co. v. South West Oil Corpo- 
ration, 219 S. W. 1115 (Tex. Civ.) on its facts the Court seems to 
hold that the reassignment of leases or return of the papers was 
a material condition in an oil lease upon which to predicate the 
right to abandon. 

Waiver of Notice. 

Altho the contract calls for notice of abandonment, if the 
abandonment is complete, no notice is required. East Jersey 
Iron Co. v. Wright, 32 N. J. Eq. 248. 



CHAPTER 27. 

FORFEITURE. 

Forfeiture is an adjudication of a man's case in his own favor 
without process of law and yet it is a necessary remedy where 
speedy action is essential and when resisted by the tenant, is 
constantly enforced by decree in oil and gas lease cases. But 
because it is a summary remedy and liable to be oppressively 
used it is and should be restricted by equitable conditions. 

A' lessor who had obtained all the benefit he could expect from 
the lease will not be heard to set it aside on technical grounds. 
Bush-Everett Co. v. Vivian Oil Co., 128 La. 886, 55 So. 564. 

There is a distinction between abandonment and forfeiture. 
Forfeiture is an enforced release not resting on intention while 
abandonment involves the intention of the lessee to quit. But 
abandonment is the predicate upon which by operation of law 
forfeiture is based. Garrett v. South Penn Oil Co., 66 W. Va. 
587, 66 S. E. 741. 

Burden of Proof. 

The proof of forfeiture for failure to make payments is upon 
the party alleging such forfeiture. Baird v. Atlas Oil Co., 84 
So. 366 (La.). 

When Not Enforceable. 

The most general statement is that as a rule it is not allowed 
upon breach of covenant merely implied, nor where the lessors 
remedy at law is adequate nor where the lessor by estoppel, 
laches, waiver or acts of oppression has lost his right to this re- 
lief. 

An ambiguous and uncertain forfeiture clause in a lease will 
not be enforced. Decker v. Kirklicks (Tex.) 216 S. W. 385. 
And in no event will forfeiture be enforced where the default 
M. 0. R.— 8. H3 



114 MORRISON'S OIL RIGHTS 

was brought about by the lessors bad faith. Doddridge County 
Oil d; Gas Co. v. Smith, 154 Feci. 970. And a suit to annul an 
oil lease will not lie where the complaining party is holding on 
to benefits received and is unable or unwilling to restore the 
defendant to the status quo. Nabors Oil, etc.,- Co. v. McCor- 
mick, 145 La. — 81 So. 766. 

After Sale. 

A lessor who has either sold the land or assigned the royalty 
can no longer declare a forfeiture. Baird v. Atlas Oil Co., 84 
So. 366 (La.). 

Propositions Decided. 

The numberless cases on the forfeiture of oil and gas leases 
seem with a fair amount of unanimity to decide the following 
propositions : 

1. That the forfeiture clause is for the protection of the lessor 
which is self evident. 

2. That this class of leases is an exception to the rule, that in 
equity forfeiture is not favored. 

3. That forfeiture needs no decree but is automatic where the 
lessee quits the premises or a peaceable entry can be made. 

4. That failure to start a well within a reasonable time is 
ground for forfeiture ; and the same when lessee has the option 
to work or pay rent and fails to do either. 

5. That it will not be decreed for breach of an implied cov- 
enant, but the implied covenant to sink is an exception to this 
rule. Nor will it be allowed on other covenants when the for- 
feiture clause is limited to certain covenants. 

6. That acceptance of rent excuses failure to work. 

7. That where a right to forfeit has accrued and it is not 
automatic, the lessor must demand performance, before he is in 
position to enforce this remedy. 

8. That while forfeiture as a rule is not enforced where there 
is ample remedy at law, this rule will not be applied where the 
damages cannot be ascertained nor where the lease . itself ex- 
pressly provides for forfeiture. 



FORFEITURE 115 

9. That where a cause of forfeiture has accrued, it may be 
waived by acceptance of delay rent or lost by estoppel. 

10. That after dealing: loosely with the lessee for a long time, 
lessor cannot abruptly change his attitude and insist on strict 
performance. 

11. That where the default of the lessee is excusable he may 
be relieved in equity by alternative decree allowing perform- 
ance. 

The ease* cited below illustrate these propositions under the 
varying conditions which litigation always presents. 

Forfeiture Clause Is for Benefit of Lessor. 

The forfeiture clause is for the protection of the lessor, and to 
be exercised at his option. Woodland Oil Co. v. Crawford, 55 
Ohio 161, 34 L.R.A. 62, 44 N. E. 1093 • Dill v. Froze, 169 Ind. 53, 
79 N. E. 971; Henne v. South Penn Oil Co., 52 W. Va. 192, 43 
S. E. 147 ; McKee v. Grimm, 57 Okla. 680, 157 Pac. 308. - 

The reservation of the right to forfeit is for the benefit of the 
lessor and until he elects to declare it, the liability for rent con- 
tinues. Mathews v. People's Natural Gas Co., 179 Pa. 165, 36 
Atl. 216, 18 M. R, 552 ; Roberts v. Bettman, 45 W. Va. 143, 30 
S. E. 95, 19 M. R. 326. 

The forfeiture clause is for the benefit of the lessor and to be 
used at his option. And such terms as that the lease "shall be 
of no effect" or "can only be renewed by mutual consent" are 
merely different phrases to mean the same thing. Jones v. West- 
ern Pennsylvania Natural Gas Co., 146 Pa, 204, 23 Atl. 386. 

Exception to Rule. 

The rule that forfeitures are not favored does not apply to oil 
and gas leases^ Risch v. Burch, 175 Ind. 621, 95 N. E. 123; 
Gadbury v. Ohio, etc., Gas Co., 162 Ind. 9, 62 L.R.A. 895, 67 
N. E. 259, 22 M. R. 680; Huggins v. Daley, 99 Fed. 606, 40 
C. C. A. 12, 48 L.R.A. 320, 20 M. R. 377. 

In Brown v. Vander grift, 80 Pa. 142, it was distinctly held 
that the fugaeious and wandering incidents of oil made its leas- 



116 MORRISON'S OIL RIGHTS 

ing exceptional so that forfeiture would be enforced by a Court 
of Equity. 

The case of Brewster v. Lanyon Zinz Co., 140 Fed. 801, 72 C. 
C. A. 213, goes fairly into the reasons why the usual rule that 
equity will not enforce a forfeiture, does not apply to oil and 
gas leases. 

Where forfeiture is a legitimate issue before the jury, the 
Courts should not charge to the effect that the law does not 
favor forfeiture. Munsey v. Marnet Oil, etc., Co. (Tex. Civ. 
App.) 199 S. W. 686. 

When Automatic. 

A judicial forfeiture is not necessary where the lease provides 
for it and the lessee has abandoned operations. Gillette v. Mit- 
chell (Tex. Civ. App.) 214 S. W. 619. 

Where the lease provides that a well shall be sunk or delay 
rental paid, in default of which the lease shall "terminate as to 
both parties" it is an alternative condition. If lessee complies 
with neither of his options, time being of their essence, "the 
lease terminated by its terms," and refusing relief to the default- 
ing lessee is not declaring a forfeiture. Curtis v. Harris 
(Okla.) 184 Pac. 574; Elliott v. Crystal Springs Oil Co. (Kan.) 
187 Pac. 692. 

The clause that the lease on certain defaults shall be null and 
void is not automatic, but requires the action of the lessor to 
make it void. Edmonds v. Mounsey, 18 M. R. 384, 15 Ind. App. 
399, 44 N. E. 196; Bartley v. Phillips, 179 Pa. 175, 36 Atl. 217, 
18 M. R, 542. 

Delay to Sink, Perform or Pay. 

The least favored of all forfeitures are those founded upon 
mere delay to pay money and when the lessee has repeatedly ac- 
cepted payments when overdue he cannot forfeit the lease for 
delay on a later payment. Denniston v. Kenova Oil Co., 220 
S. W. 1078 (Ky. App.). 

Equity will protect the lessor by a decree of foreiture for 
want of diligence to operate and the lessor is not confined to 



FORFEITURE 117 

his action for damages. Blackwell Oil, etc., Co. v. Whitesides 
(Okla.) 174 Pac. 573. But where time is not a material inci- 
dent to the performance of the lease terms, equity will not en- 
force forfeiture for inadverdent delay. Lynch v. Versailles Fuel 
Gas Co., 165 Pa. 518, 30 Atl. 984, 18 M. R. 149. And the lessor 
may be restricted to his action for damages. Barker v. Dale, 3 
Pittsb. Rep. 190, Fed. Cas. No. 988, 8 M. R. 597. 

After reasonable time to sink, lessor is entitled to cancella- 
tion. Davis v. Riddle, 25 Colo. App. 162, 136 Pac. 551 ; Kimball 
Oil Co. v. Keeton, 31 Ky. Law Rep. 146, 101 S. W. 887. Two 
years delay justifies forfeiture. Gadbury v. Ohio, etc., Gas Co., 
162 Ind. 9, 62 L.R.A. 895, 67 N. E. 259, 22 M. R. 680. 

Where a lessee is in default and makes no effect to perform 
until after a paying well in the neighborhood had been struck, 
he has no standing in the Court of equity. Bearman v. Dux 
Oil, etc., Co. (Okla.) 166 Pac. 199. 

The failure of the lessee to sink a second well where under 
implied covenant to sink such well and the clanger of drainage 
are grounds on which to base the forfeiture of his lease. This 
case contains a full review of cases supporting forfeiture. 
Brewster v. Lanyon Zinc Co., 140 Fed. 801, 72 C. C. A. 213. 

Where the lessee was to complete a well within a year or pay 
$40 for each additional quarter year of delay, the lease cannot 
be forfeited because the lessee waited until the last day of the 
year when lie brought a load of rig material to the premises. 
Washburn v. Gillespie, 261 Fed. 41. 

Where a present consideration is paid for the lease and for- 
feiture is not expressly provided for none can follow from neg- 
lect or delay to drill. Chandler v. Hart, 161 Cal. 405, Ann. 
Cas. 1913B 1094, 119 Pac. 516. 

A lease covenanting to begin work within a year or pay for 
delay gives the option to drill or pay, and failure to do either 
made the lease forfeitable. Mellton v. Cherokee Oil, etc., Co. 
(Okla.) 170 Pac. 691. 

Lessor may refuse tender of rent and enforce forfeiture after 
long delay to tender and the execution of a second lease. Brown 
v. Vandergrift, 80 Pa. 142. 



118 MORRISON'S OIL RIGHTS 

Not Allowed for Breach of Implied Covenants. 

The general rale is that the lease must state conditions on 
breach of which forfeiture lm.y be declared. Smith v. People's 
Natural Gas Co., 257 Pa. 396, 101 Atl. 739; Cochran v. Gulf Re- 
fining Co., 139 La. 1010, 72 So. 718; Alford v. Dennis, 102 Kan. 
403, 170 Pac. 1005. But breach of the implied covenant to sink 
is an exception to this rule, because damages afford no adequate 
remedy. Sledge v. Stolz (Cal. App.) 182 Pac. 340. 

Where certain breaches under the lease call for forfeiture, for- 
feiture will not be implied from breaches of other covenants. 
The lessor's remedy is in damages. Core v. New York Petroleum 
Co., 52 W. Va. 276, 43 S. E. 128 ; Harris v. Ohio Coal Co., 57 
Ohio 118, 48 N. E. 502, 19 M. R, 157; Davis v. Chautauqua Oil 
it- G. Co., 78 Kan. 97, 96 Pac. 47. 

Acceptance of Rent. 

Accepting rent after cause of forfeiture accrued, waives the 
forfeiture. Maud Oil, etc., Co. v. Bodkin (Okla.) 180 Pac. 959. 

Acceptance of the delayed rent, is a waiver of the covenant to 
drill. Beatty Oil & Gas Co. v. Blanton, 245 Fed. 979 ; Johnson 
v. Armstrong, 81 W. Va, 399, 94 S. E. 753. Or any part of it. 
Ohio Valley Oil, etc., Co. v. Irvin Dev. Co., 184 Ky. 517, 212 
S. W. 110. Where lessee paid rent for thirteen years and was 
one day late in making the payment for the fourteenth year, the 
enforcement of forfeiture would be unconscionable. A tender 
before the lessee takes action to enforce the forfeiture, will save 
the lease. McKean Natural Gas Co. v. Wolcott, 254 Pa. 323, 98 
Atl. 955. 

Where gas is produced, but not marketed, that fact does not 
authorize the lessor to forfeit the lease where the lessee is willing 
to pay the rent. McGraw Oil & G. Co. v. Kennedy. 63 W. Va. 
595, 28 L.R.A.(N.S.) 959, 64 S. E. 1027. 

Demand When Necessary. 

Where the lessee was to begin a well within one year, or pay 
twenty-five cents an Here for each year of delay, it was held that 
the real consideration was the sinking of the well, but the lessor 



FORFEITURE 119 

must first notify the lessee that he will no longer accept rent 
and will insist on sinking- before he can claim forfeiture. War- 
ren Oil, etc., Co. v. Gilliam, 182 Ky. 807, 207 S. W. 698. To 
same effect, New American Oil, etc., Co. v. Troyer, 166 Ind. 402, 
76 N. E. 253, 77 N. E. 739. 

Acceptance of rent permits delay to work and lessor must 
demand development before lie can cancel. Plumber v. South- 
ern Oil Co. (Ky.) 214 S. W. 896. 

Under a departmental oil and gas lease, the lessor cannot de- 
clare a lease forfeited on ten days' notice — but must give notice 
that unless the lease is complied with in ten days he will declare 
a forfeiture. Pierce Oil Corp. v. Schacht (Okla.) 181 Pac. 731. 

Under the null and void clause, the lessor must elect to de- 
clare a forfeiture — but the declaration of forfeiture is no re- 
lease for accrued damages. Leatherman v. Oliver, 17 M. R. 526, 
151 Pa. 646, 25 Atl. 309. 

Express Provision for Forfeiture. 

The rule of nonforfeiture where damages may be recovered 
does not apply where the lease expressly provides for forfeiture. 
tftakto *: Bridgeport Oil Co., 238 111. 397,403, 87 N. E. 381. 

Not Allowed Where Relief at Law. 

Smith v. People's Natural Gas Co., 257 Pa. 396, 101 Atl. 739. 
And the lessor has the burden of proof to show that he cannot 
be so compensated. Rembarger v. Losch (Ind. App.) 118 N. E. 
831. Equity will not cancel a lease where ejectment is a com- 
plete remedy. Patterson v. United Natural Gas Co., 263 Pa. 21, 
105 Atl. 828. 

Where the defendant was under agreement to sink and oper- 
ate wells, failure to perform being alleged, it was held that the 
remedy was by action at law for damages and not in equity by 
bill for forfeiture. Amnions v. South Penn Oil Co., 47 W. Va. 
610, 35 S. E. 1004; Core v. New York Petroleum Co., 52 W. 
Va. 276, 43 S. E. 128. 

The rulings in these last paragraphs taken together plainly 
show that damages is the normal remedy as in other cases be- 



120 MORRISON'S OIL RIGHTS 

tween landlord and tenant unless the tenant has conceded the 
right to forfeit and maintain the general principle that a 
Chancery Court has no duty to perform until a Court at law 
lias shown itself unable or unwilling to relieve. 

The Absence of a Market 

is such an excuse for breach of covenant to drill as will prevent 
forfeiture. The remedy if there is a breach, is in damages. Foe 
v. Vlrey, 233 111. 56, U N. E. 46. 

Waiver, Estoppel, Laches, Oppression. 

After lessee has paid rent for many years to enforce for- 
feiture for one days' delay, would be unconscionable. McKean 
Natural Gas Co. v. Wolcott, 254 Pa. 323, 98 Atl. 955. Equity 
will not enforce forfeiture for a short and excusable delay to 
pay rent. Aggers v. Shaffer, 256 Fed. 648. After accepting 
many delay rentals, lessor cannot summarily declare forfeiture. 
Johnson v. Armstrong, 81 W. Va. 399, 94 S. E. 753. He can- 
not lull the lessee by his indulgence and later suddenly change 
his attitude and enforce forfeiture for an already condoned de^ 
fault. Pyle v. Henderson, 65 W. Va. 39, 63 S. E. 762. 

Forfeiture may be waived or the lessor estopped by some act 
from enforcing it. Munsey v. Mamet Oil, etc., Co. (Tex. Civ.) 
199 S. W. 686. 

A waiver of default in sinking a seventh well within the time 
limited, is proved by the fact of acquiescence to delay in sinking 
the earlier wells. Duffield v. Hue, 129 Pa. 94, 18 Atl. 566, 17 M. 
R. 253. 

Forfeiture will not be enforced for short delay where lessor 
has allowed lessee to believe that forfeiture would not be en- 
forced for such default. Steiner v. Marks, 18 M. R. 320, 172 
Pa. 400, 33 Atl. 695. 

Equity will not enforce a forfeiture when it has been waived 
and a single cotenant has the right to make the waiver. Schmidt- 
Blakely Coal Co. v. Hembree, 134 Ark. 396, 205 S. W. 111. 

Where lessor's title being found defective he promises to makt; 
it good, he cannot under such status enforce a forfeiture or gjve 



FORFEIT URE 121 

a valid second lease. Pyle v. Henderson, 65 W. Va. 39, 63 S. E. 
762. 

Where the lessor after knowledge of lessees default allows 
him to make expenditures, it is a waiver of the forfeiture. Lynch 
v. Versailles Fuel Gas Co., 165 Pa. 518, 30 Atl. 984, 18 M. R. 
149; Bellinger v. Smith, 142 La. 1009, 77 So. 947; Pierce Oil 
Corp. v. Schacht (Okla.) 181 Pae. 731; Owens v. Corsicana Pet. 
Co. (Tex. Civ. App.) 169. S. W. 192. 

Whether lessors acts justify the lessee in claiming a waiver 
is a jury question. Sterner v. Marks, 18 M. R. 320, 172 Pa. 400, 
33 Atl. 695. 

Relief in Equity. 

Equity may relieve against, but will not enforce a forfeiture. 
Newton v. Kemper, 66 W. Ya. 130, 66 S. E. 102. This is the 
general rule but qualified as above in most oil and gas cases. 

Where there has been such a substantial compliance with the 
lease that gross injustice would be done by taking it from him, 
equity will grant him release as from a forfeiture. Interference 
of plaintiff with the lessee's work fortifies this position. Eastern 
Oil Co. v. Coulehan, 65 W. Va. 531, 64 S. E. 836. 

Deposit of delay rental within three days after limited period, 
held to save the lease from forfeiture. Ohio Valley Oil, etc., Co. 
v. Irvin Dev. Co., 184 Ky. 517, 212 S. W. 110. 

Equity will relieve the tenant altho there has been a breach 
where lessor has not suffered by the delay. Shaffer v. Marks, 241 
Fed. 139. 

The unexpectedly large flow of oil, rendering impossible lit- 
eral compliance with the lease is considered by the Court in re- 
fusing the forfeiture and receivership demanded by the com 
plainant. Chicago A. Oil, etc., Co. v. United States Petroleum 
Co., 12 M. R. 570, 57 Pa. 83. 

When lessor has refused to accept rent tendered and sued for 
damages which he Jias no right to recover, such conduct excuses 
the defendant from further payments ; his action has been such 
that he cannot put the defendant in default. Leonard v. Busch- 
Everett Co., 139 La. 1099, 72 So. 749. 



122 MORRISON'S OIL RIGHTS 

Wrongful declaration of forfeiture will excuse starting to 
sink. Johnson v. Armstrong, 81 W. Va. 399, 94 S. E. 753. 

A lessor who sells part of the demised land cannot enforce 
forfeiture as to the land sold, for a subsequent breach. Brewster 
v. Lanyon Zinc Co., 140 Fed. 801, 72 C. C. A. 213; Cochran v. 
Gulf Ref. Co., 139 La. 1010, 72 So. 718. 

The lessee will be relieved on alleged failure to pay an annual 
rental, when the payment was in fact made but owing to the 
mistake of a clerk was sent to the' lessor instead of to his assignee. 
Brunson v. Carter Oil Co., 263 Fed. 935. 

Forfeiture is a harsh remedy to be cautiously applied. Wait- 
ing for a pipe line held to excuse a delay of three years in con- 
nection with the fact that lessees were continually at work 
sinking several wells. Strange v. Hicks, 188 Pac. 347 (Okla.). 

Belief When Denied. 

Where the lessee has neither sunk a well nor paid the delay 
rental, equity will not relieve against the forfeit provided for in 
the lease. Dill v. Fraze, 169 Ind. 53, 79 N. E. 971. 

Acceptance of a delay rental check, one day after it was due, 
held no assent to like delay on a later payment. In this case the 
Court refused to release from forfeiture, altho check had been 
sent in due time and was delayed in the mail. Frank Oil Co. v. 
Belleview Gas & Oil Co., 29 Okla. 719, 43 L.R,A.(N.S.) 487, 119 
Pac. 260. 

In Weiss v. Claborn, two daj r s after the time expired the lessee 
tendered the delay rental which w r as refused and the Court held 
that the lease should be cancelled. The case states the distinc- 
tion between a covenant and condition subsequent. 219 S. W. 
884 (Tex. Civ.). 

Practice. 

There is a clear distinction between the case required to en- 
force a forfeiture and the facts sufficient to relieve from it. 
Smith v. People's Natural Gas Co.. 257 Pa. 396. 101 Atl. 739. 

Under the California Statute notice of forfeit are must be 



FORFEITURE * 123 

.signed by all the lessors. Jameson v. Chanslor Cornfield, etc. Oil 
Co., 176 Cal. 1, 167 Pac. 369. 

Third parties cannot take advantage of a clause in a lease 
giving lessor a right to forfeit. Bearman v. Dux Oil Co. (Okla.) 
166 Pac. 199; Brennan v. Hunter (Okla.) 172 Pac. 49. 

A covenant by the assignor of an interest in an oil lease that 
he will pay the rental and prevent a forfeiture is broken by a 
sale thereafter of the lease to another, who makes a surrender 
of it, or who by failure to pay the rental suffers a forfeiture. 
Millan v. Bartlctt, 69 W. Va. 155, 71 S. E. 13. 

Choice of Remedies. 

The lessor cannot enforce forfeiture and later collect the 
money for the nonpayment of which forfeiture was declared. 
Stine v. Producers Oil Co. (Tex. Civ. App.) 203 S. W. 126; 
Wilson v. Goldstein, 152 Pa. 524, 25. Atl. 493. 
- The effect of forfeiture is to prevent any further relief; the 
right to surrender and the right to specific performance are both 
gone. Bearman v. Dux Oil Co. (Okla.) 166 Pac. 199. 

Alternative Decree. 

Forfeiture may be decreed subject to the right of lessee to re- 
lieve himself by paying up the default. Stine v. Producers Oil 
Co. (Tex. Civ. App.) 203 S. W. 126. And in Alford v. Dennis, 
102 Kan. 403, 170 Pac. 1005, the lessee was allowed opportunity 
to perform. 

Forfeiture of part of the demised tract may be decreed ex- 
cepting parcels where wells have been diligently developed. Pel- 
ham Pet. Co. v. North, 188 Pac. 1069 (Okla.). 

Special Instances. 

Where a company was bound to do the annual labor on a 
large oil tract, its breach of performance on a part of the tract 
did not forfeit its rights on the acreage which it did protect. 
Jameson v. Charslor-Canfield, etc., Oil Co., 176 Cal. 1, 167 Pac. 
369. 

Under a lease for two years one well was sunk producing a 



124 MORRISON'S OIL RIGHTS 

small yield of oil; the Court held under the facts that the land 
was not being held for speculating purposes and refused to for- 
feit the lease. Hughes v. Busseyville Oil. etc., Co., 180 Ky. 545, 
203 S. W. 515. 

The landlord sued to quiet his title against the lessee calling 
for the drilling of a well within twelve months or pay $20 yearly 
rental until the well was drilled. There was a clause that the 
lessor was to have gas from the premises for the buildings. The 
complaint alleged that no well had been sunk or any money paid 
with other supporting averments. The complaint was held good. 
The lessee furnished free gas from other premises which was 
accepted in lieu of rent. The answer was held a defense and that 
the lease was not forfeited. Indiana Natural Gas, etc., Co. v~ 
Leer, 34 Ind. App. 61, 72 N. E. 283. 



CHAPTER 28. 

OPTION. 

An option may be either separate or, more usually, combined 
with the lease and where so combined while they are construed 
together they may be so worded that the forfeiture of the one 
may not mean the ending of the other. Mathews Slate Co. v. 
New Empire Slate Co., 122 Fed. 972. 

The points usually leading to controversy arise upon mutual- 
ity, the consideration or want of consideration, time, and the ex- 
tension of time. 

Consideration and Mutuality. 

It is of the very essence of an option that it should not be 
mutual. The optionee "pays his money or performs his promise" 
which makes a good consideration for the "right of choice." 
North Western Oil Co. v. Branine (Okla.) 175 Pac. 533; Pitts- 
burg Vitrified, etc., Bricks Co. v. Bailey, 76 Kan. 42, 12 L.R.A. 
(N.S.) 745, 90 Pac. 803. 

Agreement to drill well as a matter of course was held con- 
sideration in Starr v. Crenshaw (Mo.) 213 S. W. 811. The same 
as to agreement to work a mine. Clarno v. Grayson, 30 Ore. Ill, 
46 Pac. 426. 

An option to convey or renew a lease, though not mutual, when 
given for a consideration, is a binding contract forfeiture of 
which will not be decreed. Brunson v. Carter Oil Co., 259 Fed. 
656. Where both bonus and rent have been paid, the option is 
upon good consideration and the surrender clause also, is sup- 
ported. Jackson v. Pure Oil Co. (Tex. Civ. App.) 217 S. W. 959. 

An option in an oil lease although unilateral, if supported by 
valid consideration can be enforced the same as any other con- 
tract. Hunter v. Gulf Prod. Co., 220 S. W. 163 (Tex. Civ.). 

The consideration of $1 is held to be valid to support an op- 

125 



126 MORRISON'S OIL RIGHTS 

tion in Emde v. Johnson (Tex. Civ. App.) 214 S. W. 575, tho 
the contract in that case was in fact a lease and not an option. 
Bnt it cites the authorities which uphold generally the $1 con- 
sideration. 

Failure to make the first payment determines both lease and 
option. Hazzord v. Johnson (Cal. App.) 187 Pac. 121. 

Naked Option. 

A naked option may be withdrawn at any time; it is only a 
continuous offer to sell, but if a consideration is paid or if it is 
accepted before a withdrawal it becomes a binding promise. 
Threlkeld v. Inglett, 289 111. 90, 124 N. E. 368. 

A naked option — that is, a mere promise to sell or lease, wheth- 
er verbal or written, made or given without consideration, until 
something is done under it or paid upon it, is void. Smith v. 
Reynolds, 8 Fed. 696, 3 McCrary, 157, 2 M: R, 227 ; Finnerty v. L 
Fritz, 5 Colo. 174, 1 M. R. 437; Gordon v. Darnell, 5 Colo: 3.02, 
2 M. R. 220; Cortelyou v. Bamsdall, 236 "111. 138, 86 N. E. 200. 

An option without consideration may be revoked by letter, 
and a loss to the promissee was held no sufficient consideration 
for the promise of the option. Texas Co. v. Dunn, 219 S. W. 
300. 

Time. 

That time is of the essence of the option in any sort of min- 
ing property has been so repeatedly decided that it is now as- 
sumed as a matter of course, even if the contract does not use 
the phrase: that time shall be of the essence of the contract. 
Smith v. Beebe, 31 Ida. 469, 174 Pac. 608 ; Mackey Wall Plaster 
Co. v. United States Gypsum Co., 244 Fed. 275 ; Christie's Ap- 
peal, 85 Pa. 463, 9 M. R, 42 ; Brown v. Vandergrift, 80 Pa. 142. 
In Levy v. Hoffman, 235 Fed. 46, 148 C, C. A. 540, it was at- 
tempted to prove a custom that after the period for payment 
limited, the purchaser had further time to examine the title and 
otherwise get ready to perfect the purchase, but this was dis- 
allowed by the Court. 

On the expiration of the time limit the owner is entitled to 
repossess himself of the property including fixtures which the 



OPTION 127 

optionee had agreed should become parcel of the realty and such 
repossession is in no sense a rescission of the contract. Smith v. 
Bcebe, 31 Ida. 469, 174 Pac. 608. 

Time is of the essence of the contract in an oil lease and no 
particular form of words is necessary to express it, under the 
Oklahoma Statute requiring time when of the essence to be so 
expressed in the contract. Mitchell v. Probst, 52 Okla. 10, 152 
Pac. 597. 

Extension of Time. 

The extension of time on an option is of constant occurrence 
and the question of whether any consideration at all is required 
for such extension, or if required, what is sufficient consideration 
has been often passed on. 

The consideration of $1 and lessee's agreement to drill ad- 
joining ground of lessor is good consideration for extension of, 
time. Dotcney v. Gooch, 240 Fed. 527. And a promise to do the 
annual labor is sufficient consideration. Stanley v. Hem-pie, 173 
Fed. 61, 97 C. C. A. 379. This case further holds that the weight 
of authority is that a verbal promise to extend time is valid. 
Where the conditions are changed no new consideration is 
needed. R asset, etc., v. Lambert, 14 Ida. 284, L.R.A.1915B 20, 
94 Pac. 54. In L.R.A.1915B is a full citation of, the holdings 
that mere enlargement of time for performance may need no 
new consideration at all. 

Possession — Working Lease and Option. 

The right of possession may arise b}' implication from the 
terms of an executory contract. Francis v. West Virginia Oil 
Co., 174 Cal. 168, 162 Pac. 394. The holder of an option allowed 
to work the mine becomes a lessee. Nichelson v. Smith, 31 Ida. 
544, 174 Pac. 1008. 

In Johnson v. Clark, 174 Cal. 582, 163 Pac. 1004, an option 
contract is construed and it was -held on the facts that retaining 
possession and pajonent on account did not merge the option into 
an executory contract to drill. 

A contract allowing a party to take possession, work the 
placer and pay royalty with the option to purchase — but if he 



128 MORRISON'S OIL RIGHTS 

declined to purchase the owner was to pay him his net loss and 
resume possession was construed as neither conveyance nor 
lease, but a mere license. In re Seward Dredging Co., 242 Fed. 
225, 155 C. C. A. 65. 

The payment of an independent consideration is good consider- 
ation for the optional privileges allowed to the lessee. Ay cock 
v. Reliance Oil Co. (Tex. Civ. App.) 210 S. "W! 848; Pylc v. 
Henderson, 65 W. Va. 39, 63 S. E. 762. 

Rent for Delay. 

Lease providing for continuous payment of delay rentals, con- 
strued as an option renewable from period to period by payment 
of the rent. Frank Oil Co. v. Belleview Gas, etc., Co., 29 Okla. 
719, 43 L.R.A.(N.S.) 487, 119 Pac. 260. 

Where the lease provided that a well should be drilled within 
a fixed time and if none drilled within that time, lessee should 
pay an annual rent, it was an option and gave the lessor the right 
to cancel without notice if not complied with. Mitchell v. Probst, 
52 Okla. 10, 152 Pac. 597. 

A lease for a fixed term on a royalty providing for the com- 
pletion of a well within a year, but with the clause allowing 
unlimited delay rentals and with the right to surrender was con- 
strued as a mere option in Owens v. Corsica na Pet. Co. (Tex. 
Civ. App.) 169 S. W. 192. But see the later case of Pierce 
Fordyce Oil Assoc, v. Woodrum (Tex. Civ. App.) 188 S. W. 245. 

An oil lease giving an option to begin within a fixed time 
or to pay a delay rental is a contract upon condition subsequent 
and is valid. Priddy v. Green, 220 S. W. 243 (Tex. Civ.). 

Speculative Purpose. 

An option for speculative purposes based on no legal considera- 
tion will not be specifically enforced. Gillespie r. Fulton Oil, 
etc., Co., 140 111. App. 147. On the other band such an option 
on proper bill will be cancelled. ' Cortelyou v. BarnsdaU, 140 111. 
App. 163. And on appeal of this last ease it was held that a 
naked option until something is done to bind the lessee to action, 
is void, 236 111. 138, 86 N. E. 200. But in Thrclheld v. Inglelf, 
289 111. 90, 124 N. E. 368, it was hold that it was no objection to 



OPTION 129 

a bill for specific performance, that the contract was for specu- 
lative purposes. If there is a valuable considei-ation and no det- 
riment to the land by damages of drainage we cannot see why 
the ultimate motive of the buyer should defeat his legal rights. 

Special Instances. 

A contract for the sale of a placer claim to be paid out of 
the proceeds was construed as an option. Such covenants of a 
contract do not run with the land. Smith v. Jones, 21 Utah 270, 
GO Pac. 1104. 

In Pittsburg Vitrified, etc., Brwk Co. v. Bailey, 76 Kan. 42, 
12 L.E.A.(N.S.) 745, 90 Pac. 803, a lease provided a fixed term 
and a royalty with the paying quantities clause and the surren- 
der clause held that such contract strictly speaking is not a lease, 
but the sale of an option. 

Stock had been sold to raise money to develop the mine. The 
contract was by resolution offering 100,000 shares at 10 cents 
per share for this purpose. Enough money was raised on a part 
of this allotment to put the mine on a pay basis. The optionee 
then demanded the full 100,000 shares at the 10 cents figure. 
Hut the Court ruled that the option was held for sale of enough 
stock to put the company on its feet and the optionee was de- 
feated. WSds&k v. Bichmond 31., etc., Co., 102 "Wash. 248, 172 
Pac. 1162. 

A sale of 2000 gals, of oil per day with the option to take the 
whole product of the well is valid and not satisfied by delivery 
of the 2000 gallons. Bluffer v. Gulf Pipe Line Co. (Tex. Civ. 
App.) 218 S. W. 89. 

Repudiation. 

Notice by the owner that he repudiated the option, releases 
the optionee from performance of any further conditions in the 
contract. Starr v. Crenshaw (Mo.) 213 S. W. 811. 

A Chattel Real. 

The title of a sublessee and optionee in default on the pay- 
ments, is a chattel real and not subject to sale on execution. 
Christies' Appeal, 85 Pa 46-3, 9 N. E. 42. 
M. o. R.— 9. 



CHAPTER 29. 

LICENSE. 

A license is the permission of the owner to another to enter 
upon or use his land. It carries no estate or property and is 
not assignable and is no exclusion of the owner nor of other li- 
censees, and is revocable at will. 

But anything which has been extracted from the earth under 
a license becomes the property of the licensee and it cannot be 
arbitrarily revoked after expenditures without compensation. 

It is self evident that a lease includes a license, but a license 
has not advanced to the dignity of a lease. It is further obvious 
that it closely approaches towards a lease and many informal 
permissions to work which would seem to have been intended 
as leases have been arbitrarily denounced as mere licenses. 

A parol license to mine was given to one, followed by a writ- 
ten lease to another, on the same ground. The Court held that 
the giving of the lease revoked the license. Every license which 
covers some usufruct in the land, to be irrevocable, must be by 
deed — it is the grant of an incorporeal hereditament. K amp- 
house v. Gaffner, 73 111. 453, 2 M. R, 256. 

In Grubb v. Bayard, 2 Wall. Jr. 81, Fed. Cas. No. 5,849, 9 
M. R. 199, the grantor had covenanted that grantee might dig, 
take and carry away all the iron ore, at a roj^alty; the Court 
held it to be an incorporeal hereditament — carrying no property 
right in the ore until severed ; not exclusive in the grantee and 
not divisible, citing Lord Mount joy's case, 4 Leonard 147, 9 M. R. 
175; Dark v. Johnston, 55 Pa. 164, 93 Am. Dec. 732, 9 M. R. 283. 
A note to these cases in Thornton on oil and gas sec. 67 suggests 
as we do "it may well be doubted if the instruments did not give 
an actual interest in the real estate itself." 

An oil lease is more like a license than an estate in land. 
Mitchell v. Probst, 52 Okla. 10, 152 Pac. 597. 

A contract giving the exclusive right to dig ore, is a license 

130 



LICENSE 131 

and not a grant or demise, unless coupled with an interest or so 
far executed as to create a property right in the mineral; it is 
revocable at will. East Jersey Iron Co. v. Wright, 32 N. J. Eq. 
248. This New Jersey case contains perhaps the clearest state- 
ment to be found, of the distinction between a license and a lease. 

When Not Binding on Licensee. 

Whether a document be called a lease or a license is immaterial 
on the interpretation of what it means. A contract requiring 
defendants to pay $100 a month "while they are taking stone 
from his quarry" does not bind them to pay rent when they never 
began to take stone from the quarry. Nega v. Barber Asphalt 
Paving Co., 17 Mo. App. 294. 

To Use Rig, Not Revocable. 

Where the lessor allows the lessee the use of a rig, casing and 
materials as an inducement to take the lease, he cannot revoke 
his license before the well is drilled. Doddridge County Oil & 
Gas Co. v. Smith, 154 Fed. 970. 

License by One Cotenant. 

The license to mine by one cotenant does not bind a dissenting 
cotenant. Tipping v. Bobbins, 71 Wis. 507, 37 N. W. 427; 
Omaha, etc., Refining Co. v. Tabor, 13 Colo. 41, 16 Am. St. Rep. 
185, 5 L.R.A. 236, 21 Pac. 925. But when ore is taken under 
such license the licensee is not generally held as a trespasser 
altho he must account. Job v. Potion, L. R,, 20 Eq. 84, 14 M. R. 
329. 

Statutory Licenses. 

Persons mining zinc and lead under a statute where the miner 
enters under the terms of a printed statement prescribing rules 
under which he works are licensees only and cannot maintain 
ejectment, Springfield Foundry, etc., Co. v. Cole, 130 Mo. 1, 31 
S. W. 922. 



CHAPTER 30. 

CONTRACTS. 

The Contract to Sink. 

A contract to sink an oil well carefully and to both sides 
fairly drawn, should cover the depth, whether to a specific num- 
ber of feet or to the paying sand; the time, the price and the 
terms of payment ; should provide for accidents only too sure to 
occur, some of them, practically killing the well as far as drilled: 
for strikes ; for a log- of the drilling ; for casing or 'tubing. It 
should reserve the right to order work stopped on payment for 
the feet completed (with a bonus in such case for the loss of 
profits to the contractor), because outside work in the meantime 
may have suggested that further sinking would be hopeless. 

The construction of the contract is for the Court and it is 
error to leave it to the jury. California Well Drilling Co. v. 
California Midway Oil Co., 178 Cal. 337, 177 Pac. 849. 

The contractor is not bound to sink when owners fail to supply 
casing and other items as per contract. Robinson v. Rispin, 33 
Cal. App. 536, 165 Pac. 979. In Bain v. White, 256 Fed. 428, 
the sinking was to be 2000 ft. defendant was to furnish the pip- 
ing of a certain diameter. When the well caved in, the con- 
tractor demanded a smaller pipe, which implied a reduction in 
the size of the hole, which the defendant refused to furnish, and 
lie was held to be acting within his rights. 

Fishing for tools 

is an ordinary risk in oil sinking, and the value of time lost by 
such accident cannot be added to the footage price for the sink- 
ing. South Penn Oil Co. v. Latshutv, 21 M. R. 600, 111 Fed. 598, 
49 C. C. A. 478. 

The alleged custom of the locality to compensate the oil sinker 

132 



CONTRACTS 133 

for loss of tools lost in 'drilling, must be specially pleaded. Diets 
v. Nix (Mo.) 216 S. W. 791. 

Interference with Contractor. 

Where the owner interferes with the contractor and without 
legal excuse stops the work contractor was allowed to recover 
his expenses already incurred, cost of removing the rig and loss 
of time while waiting instructions from the defendant. Letcher 
v. Moloney (Okla.) 172 Pac. 972. 

And where after sinking over 3000 feet, trouble with gas oc- 
curred and the owner interfered, not allowing the contractor 
time to meet the difficulty, he was allowed to recover for the feet 
sunk at the contract price. The Court further intimated that a 
contractor may even have the right to sink a second well if he 
fail to complete the first. Elwood Oil Co. v. McCoy (Okla.) 179 
Pac. 2. But the owner is not bound to furnish the piping for 
the second well as he was for the first. Bain v. White, 256 Fed. 
428. 

The contractor is not bound to sink when owner fails to sup- 
ply casing and other items as per contract. Robinson v. Bispin, 
165 Pac. 979, but the owner is not bound to furnish pipes which 
will reduce the size of the hole contracted for. .Bain v. White, 
256 Fed. 428. 

Sinking to Paying Quantities. 

An action for damages for breach of lessee's covenant to sink 
involved the. question whether the lessee was released by finding 
oil in paying quantities, a small not a paying flow having been 
struck. The Court held that paying quantities had not been 
reached and that lessee was not released from his express con- 
tract to sink to the Mississippi lime. Ardizonne v. Archer 
(Okla.) 178 Pac. 263. 

Down to Oil Sand. 

There was a contract that the well should reach the oil sand. 
The Court considers what was the evidence necessary to prove 
that the stratum was reached p,nd whose duty it was to test the 



134 MORRISON'S OIL RIGHTS 

drillings and further hold that a barren oil sand was not the 
oil sand intended by the contract. There were two contracts in- 
volved and very heavy expenditure had been made, but the 
rulings of the Court were strict against the contractor. Cali- 
fornia Well Drilling Co. v. California M. Oil Co., 178 Cal. 337, 
177 Pae. 849. 

The contract called for 3500 ft. of drilling or "into the oil 
sand." The burden is on the plaintiff to show that the sand 
reached was producing sand. California Well Drilling Co. v. 
California M. Oil Co., 178 Cal. 337, 177 Pac. 849. 

Good Clean Hole. 

Well sinkers contracted to sink 2000 feet and deliver "a good 
clean hole." The hole was obstructed by a piece of piping so 
that the depth could not be measured. A contractor is impliedly 
bound to turn over the well in such shape that its depth and 
character can be ascertained. The Court found that it was not 
a good clean hole. Bain v. White, 256 Fed. 428. 

Completed Well. 

The words "after the completion of a well" are words of plain 
meaning. The well in question began to throw out oil and water 
forced by gas in such form that it could not be told whether it 
was, or was not a paying well. Then it was shot and yielded oil 
in- large quantities. The Court held that it was not completed 
until it had been shot. Uncle Sam Oil Co. v. Richards (Okla.) 
184 Pac. 575. An agreement between lessee and lessor that the 
2000 ft. of drilling was a "completed well" binds both the lessor 
and his assignor. Keg v. Big Sandy, etc., Co. (Tex. Civ. App.) 
212 S. W. 300. 

Where a well is accepted before reaching the contract depth, 
the contractor has the right to his pay for the number of feet 
drilled. Robinson v. Rispin, 33 Cal. App. 536, 165 Pac. 979. 

There is a difference between drilling a well and completing 
a well. Federal Betterment Co. v. Blaes, 88 Pac. ^^ (Kan.). 
The Court uses this language: 

"When a well has been bored, that is, when enough boring 



CONTRACTS 135 

lias been done to show the presence of oil — the lessee has but 
three courses open: 1. To complete it and see that it produces 
revenue. 2. To keep on drilling under the terms of the lease, 
or 3. To surrender all claims under the lease and suffer the 
lessor to resume the absolute control of his property." 

Measure of Damages. 

When sunk and work not paid for the measure of damages is 
of course the contract price ; when price not agreed on recovery 
is on a quantum valebat. Where work is stopped by the owner 
the measure of damages is not only the price per foot of the 
feet drilled but the reasonable profit of the whole contract. 

In North Healdton Co. v. Shelley, defendants under contract, 
had drilled a well 1750 feet at a cost of $8599.24 but found noth- 
ing. The defendants then contracted to sink 250 feet further, 
but after sinking a few feet they allowed reamer blocks to remain 
in the well so that it could not be sunk further, the petition al- 
leging this to be a malicious destruction of the well. The Court 
held that if such allegations were proved, the plaintiffs were 
entitled to recover the original cost of the 1750 feet of sinking 
the amount necessary to continue it to the contract depth, or if 
completion of the old hole was impossible that the recovery 
should then be based on the cost of sinking a new well 2000 
feet. North Healdton Oil, etc., Co. v. Skelleij, 59 Okla. 128, 158 
Pac. 1180. 

Profits. 

Profits to be earned from sinking oil wells are not too specu- 
lative or remote to be basis for damages. Robinson v. Rispiv, 
33 Cal. App. 536, 165 Pac. 979. 

Cost of Casing. 

"Where the damages for failure to sink a well, are to be taken 
as the cost of the well, the cost of casing and equipment are not 
to be included. Ardizonne v. Archer (Okla.) 178 Pac. 263. 

A contractor to drill a well does not include packer and tubing 



136 MORRISON'S OIL RIGHTS 

nor covenant to safeguard against salt water. Collier v. Monger, 
75 Kan. 550, 89 Pac. 1011. 

Testing Barren Ground. 

To the covenant of a lessee to sink a well, it is no defense that 
development on adjoining territory proved the ground to be 
barren. The Court ruled strictly that the lessor had the right 
to insist on the test of actual sinking. Cochran v. Pew, 159 Fa. 
184, 28 Atl. 219. 

In Burroivs v. Petroleum Dev. Co. (Cal.) 184 Pac. 5, the con- 
tract to sink was between an option holder and the sinking com- 
pany. The option expired before the well was completed and 
the sinking company became the purchaser. The rights of the 
parties in such complication considered, the final holding being 
that the sinking company was not bound in damages for failure 
to complete the well. 

Evidence. 

Letters written by the owner to the driller after the contro- 
versy arose, are self-serving and inadmissible. Dietz v. Nix 
(Mo.) 216 S. W. 791. After suit is started plaintiff cannot go 
back to the well for further work and so alter the facts and plead- 
ings, on which the suit was started. Hard v. Wysang (Wash.) 
186 Pac. 301. 

Contract Tying Up Right to Drill. 

A contract tieing up the right to drill for a long period not 
being a mere lease and the land not being drained — is valid. 
Kroeger v. Martin (Okla.) 180 Pac. 955. 

Debt Payable Out of Mine. 

When a party is to be paid out of what the mine produces the 
worker must be allowed time to produce it. Johnson v. Geddcs, 
49 Utah 137, 161 Pac. 910. But if lie sells the mine or, as in this 
case the quarry, and so places it out of his power to comply, the 
debt becomes at once due. Grant v. Warren, 31 Cal. App. 453, 
160 Pac. 847. And there are repeated decisions that when the 



CONTRACTS 137 

debt is to be paid out of the mine it becomes absolute after a 
reasonable time. Mining Rights, 15th Ed. P. 428. 

Sales of Oil. 

Contract for sale of so many barrels of oil means the statutory 
barrel subject to evidence that barrels of different gallon contents 
were intended. Forsyth v. North American Oil Co., 53 Pa. 168, 
11 M. R. 115; Cull urn v. WagstafJ, 48 Pa. 300. Under a contract 
to deliver oil barrels on board ''preparatory to running out on 
the first water," the vendor is bound to load the barrels. Cullum 
v. W'ujstalJ, 48 Pa. 300. 

Where one of the owners of oil in a tank who had the right to 
dispose of his own share, but not of the whole, sold the entire 
contents, it was held a mere case for damages and not for injunc- 
tion, oil being considered as a staple commodity. Mason v. N or- 
ris, lb Grants ch. 500, 11 M. R. 140. 

On a contract for sale of oil to be delivered in lots where both 
parties have acted loosely on deliveries and payments, one party 
cannot suddenly insist on literal compliance. Forsyth v. North 
American Oil Co., 53 Pa. 168, 11 M. R. 115. 

A person of long experience in the oil business is competent to 
testify to the gravity te^t of oil shipped. Coad v. Fennsylvania 
liy. (Iowa) 175 N. ^\ T . 314. 

Delivery. 

An order to hold a party's oil in tank, when accepted transfers 
the possession of the oil. First Nat. Bank v. Harkness, 42 W. 
Va. 156, 32 L.R.A. 408, 24 S. E. 548. 

Oil catching fire while in the act of loading on barges is not 
delivered. Rochester, etc., Oil Co. v. Hughey, 56 Pa. 322, 4 M. 
R. 282. 

Repair of Tank. 

A contract to put a leaky tank "in perfectly good repair," 
means to put it in as good condition as it ought to be considering 
the materials of which it was composed and does not mean the 
construction of a new tank on another and better plan. Arelesco 
Oil Co. v. Richardson, 63 Pa. 162, 11 M. R. 131. 



138 MORRISON'S OIL RIGHTS 



Sales of Gas. 



A contract to furnish natural gas is purely personal and does 
not bind the assignee of the seller. Mound Valley, etc., Erich 
Co. v. Mound Valley Natural Gas, etc., Co., 258 Fed. 936. 

When the lease called for gas measurement by meter but did 
not mention the pressure, the lessor was not allowed to prove 
that extra pressure was understood. Noble v. Western Pa. Natu- 
ral Gas Co., 255 Pa. 512, 100 Atl. 480. 

A contract to sell the gas of the well for gasoline manufacture 
does not prevent the operator from using improved methods of 
stimulating oil production, even if such methods diminish the 
gasoline value of the natural gas. Beeson v. Drake Oil Co. (W. 
Va.) 97 S. E.414. 

The power of the legislature to regulate gas pressure is not 
affected by the fact that it will prevent the performance of a 
contract already made. Where a Statute makes an Act con- 
tracted for illegal, it excuses performance. Jamieson v. Indiana 
N. G. Co., 128 Ind. 555, 12 L.R.A. 652. 

Excess Gas. 

In Elk Natural Gas Co. v. Ridgway Light, etc., Co., 261 Pa. 
295, 104 Atl. 546, there was a contract for the sale of surplus gas 
over that required for customers. The Court allowed the de- 
fendant to put his own construction on what was surplus. 

Contract between Gas Well and Pipe Line. 

Ely v. Wichita N. Gas Co., 99 Kan. 236, 161 Pac. 649, con- 
strues a contract where the gas well had agreed to furnish 5,000.- 
000 cubic feet per day to a pipe line. The gas was to b_e mer- 
chantable and the party supplying the gas was defeated because 
it was shown that the gas delivered was not merchantable, be- 
cause deficient in B. T. U. (British thermal units). The Court 
also held that the title to the gas passed only as delivery was 
made. The opinion refers to the fugacious character of gas 
which seems to us to have had little to do with the merits of the 
suit. The report sets out the long and formal agreement on 
which the suit was based and is instructive on this important 
class of contracts. 



CHAPTER 31. 

PARTNERSHIP. 

What Creates the Relation. 

Where there are several lessees, or where cotenants are working 
together, they become by implication partners in law. The dis- 
tinctions between an ordinary partnership and a mining part- 
nership are few, the most important being that the sale of his 
interest by one or the decease of one or more does not dissolve 
the partnership. This is based on the fact that the joint ad- 
venture and not the choice of associates, called in law delectus 
personae creates the partnership relation. The power to bind 
the company by note does not exist in a mining partnership. 

The leading cases stating these distinctions are Skillman ik 
Lack man, 23 Cal. 198, 83 Am. Dec. 96, 11 M. R, 381 (with full 
notes in 83 Am. Dec. 103) ; Duryea v. Burt, 28 Cal. 569, 11 M. 
R. 395 ; Manville v. Paris, 7 Colo. 128, 2 Pac. 212. And they are 
most clearly discussed in Childers v. Neely, 47 W. Va. 70, 81 Am. 
St. Rep. 77*7, 49 L.R.A. 468, 34 S. E. 828, 20 M. R. 222. An oil 
syndicate is practically a partnership. Oil Lease and. Royalty 
Syndicate v. Beeler (Tex. Civ. App.) 217 S. W. 1054. 

A contract to explore for oil by prospecting new territory was 
held to constitute a partnership, though not a mining partner- 
ship in Callahan v. Danziger, 32 Cal. App. 405, 163 Pac. 65. 

Cotenants are not mining partners unless they join in working 
the property. Huston v. Cox, 103 Kan. 73, 172 Pac. 992. They 
may become general partners or mining partners. Commencing 
to sink a test well does not make them mining partners. Snider 
v. Davidson (Kan.) 185 Pac. 724. 

The co-ownership in the title is not enough to constitute the 
partnership relation and even the holding of a lease in their 
joint names, where not working together, does not constitute a 
partnership. Huston v. Cox, 103 Kan. 73, 172 Pac. 992. But 

139 



340 MORRISON'S OIL RIGHTS 

that the ownership is merely equitable, will not prevent the re- 
lation. Harper v. Sloan, 111 Cal. 174, 169 Pac. 1043. 

Good Faith Between. 

The utmost good faith is due between coadventurers : ac- 
counting decreed against party attempting to exclude his partner 
from benefit of option on one of the great Mexican oil properties. 
Brown v. Leach, 189-App. Div. 158, 178 N. Y. Supp/319. 

An oil partnership once formed applies to new acquisitions in 
the same line of business. Rolshouse v. Wally, 263 Pa. 247, 106 
Atl. 227. 

The tendency of modern decisions is to treat a mining ad- 
venture as a partnership and no associate in such joint adventure 
is allowed to make a secret profit. Menefee v. Oxnam (Cal. 
App.) 183 Pac. 379. 

Majority Control. 

Where the partners disagree in the working the majority has 
the right to control. Childers v. Neely, 47 W. Va. 7(3, 81 Am. 
St. Rep. 777, 49 L.R.A. 468, 34 S. E. 828, 20 M. R. 222; Dough- 
erty v. Creary, 30 Cal. 290, 89 Am. Dec. 116, 1 M. R. 36 ; Hawkins 
v. Spokane, etc., Co., 3 Ida. 650, 33 Pac. 40; Patrick v. Weston, 
22 Colo. 45, 43 Pac. 446; Markle v. Wilbur, 200 Pa. 457, 50 Atl 
204, 21 M. R. 532. 

Pay for Time. 

The usual rule is that they cannot charge their time against 
the firm as expenses but this does not apply when one partner 
devotes his whole time to the business. Rains v. Wciler, 101 Kan. 
294, L.R.A.1917F, 571, 166 Pac. 235. 

Borrowing Money. 

Although a mining partner has no right to give a firm note, he 
may acting in good faith borrow money necessary to carry on the 
business instead of making an assessment on his associates. 
Bams v. Weiler, 101 Kan. 294, L.R.A.1917F 571, 166 Pac. 235. 



PARTNERSHIP 141 



Assessments. 



When funds are not forthcoming' the natural result is suspen- 
sion : the alternatives are to borrow money or to assess. The right 
to assess is no more than the right to request but not to compel 
advances from the delinquent associate and the assessment can- 
not proceed to a forfeiture, unless there has been some previous 
assent to that remedy. 

But when assessments are made, remain unpaid, and the de- 
linquent interest is sold, equity will not listen to the forfeited 
shareholder, where he has delayed his appeal for relief until the 
whole status of the property has been changed, by a sudden 
strike of great value. Joseph v. Davenport, 116 Iowa 268, 89 
N. W. 1081, 22 M. R. 171. 

Deserting Partner. 

Where one partner abandons the lease, the deserted copartner 
has the right to surrender it. United Mining Co. v. Morton, 174 
Ky. 366, 192 S. W. 79. 

Lien. 

A partner for his excess advances holds a lien against his co- 
partner, that is, against the partnership, but such lien is of 
course, of no avail as against creditors of the firm. It was denied 
to a cotenant sinking an oil well in Uncle Sam Oil Co. v. Rich- 
ards, 60 Okla. 63, 158 Pac. 1187. The cases on the lien of a co- 
partner are cited in Mining Rights 15th Ed. 325. 



CHAPTER 32. 

NET PROFITS. 



Net Profits Defined. 



A covenant to pay a share of the net proceeds or net profits, 
a common clause in leases, creates a sort of partnership in the 
adventure but does not, where the lessor takes no active interest 
in the work, make him responsible for the debts of the lessee. 

The terms "net proceeds" and "net profits" seem to be synony- 
mous. Nathan v. Porter, 36 Cal. App. 356, 172 Pac. 170. Where 
on a sale part of the price was to be paid out of the "first money 
taken out of the ground" this was held to mean the gross, not the 
net proceeds of the buyers fourth interest. Lesamis v. Green- 
berg, 225 Fed. 449, 140 C. C. A. 481. And in Blanch v. Pioneer 
Min. Co., 93 Wash. 26, 159 Pac. 1077, the contract was treated 
as of a speculative character, where both parties took chances. 

In ascertaining the profit of a gas well, all expenses, including 
cost of pipe and material, payments for right of way and of 
-salaries are to be deducted and gas used on the premises is to 
be counted the same as gas sold. Stone v. Marshall Oil Co., 188 
Pa. 602, 41 Atl. 748, 1119, 19 M. R. 593. 

Working Interest. 

A lease calling for one eighth of the oil as royalty and requir- 
ing the lessee to carry for the lessee a one-sixteenth interest 
means that the lessee shall pay in addition to the royalty one 
sixteenth of the profits. Paxton v. Benedum-Trees Oil Co., 80 
W. Va. 187, 94 S. E. 472. 

There is an entirely indefensible decision in Moloney v. Love, 
11 Colo. App. 288, 52 Pac. 1029, holding a non-assessable interest 
to be one against which no expense is chargeable. It is prac- 
tically overruled in Taylor v. Thomas, 31 Colo. 15, 71 Pac. 381, 

142 



NET PROFITS 143 

where it is made chargeable with its proper proportion of ex- 
penses. See notes to the Maloney ease as reported in 19 M. R. 
310. 

The phrase "carried for an eighth interest" is discussed in 
Winemiller v. Page (Okla.) 183 Pac. 501 the Court holding that 
the opinion of experts was allowable to explain it, but without 
any clear ruling as to what it did mean. 



CHAPTER 33. 

OPEN MINES. 

Open and Unopened Mines. 

At common law a life tenant could work all opened mines but 
could not open a new mine. Clavering v. Clavering, 2 P. Wms. 
388, 24 Eng. Reprint 780, 14 M. R. 358. And such has been the 
general ruling* in the United States. Priddy v. Griffith, 150 111. 
562, 41 Am. St. Rep. 397, 37 N. E. 999. And it has been carried 
so far as to hold that the danger of drainage from other wells 
is no reason against enjoining the life tenant from opening a 
well. Richmond Natural Gas Co. v. Davenport, 37 Ind. App. 25, 
76 N. E. 525. 

On the other hand there are two Michigan cases which hold 
that the common law as to opened and new mines should not be 
applied to the conditions in this country, to destroy the just 
claims of dowagers and life tenants. Seager v. McCabe, 92 Mich. 
186, 16 L.R.A. 247, 52 N. W. 299 ; Poole v. Union Trust Co., 191 
Mich. 162, 157 N. W. 430. And it has been further held that 
where the sole value of the land is its mineral value, wills and 
contracts will be construed with reference to that fact. Wentz's 
Appeal, 106 Pa. 301 ; Raynolds v. Hanna, 55 Fed. 783. 

Notwithstanding the suggestion in the paragraph last above 
it is too well settled to be seriousty doubted that a life tenant can- 
not open an entirely new mine where there are no exceptional 
facts to take the case out of the general rule. Minner v. Minner 
(W. Va.) 100 S. E. 509. 

The life tenant may work the coal from an opened mine to 
exhaustion, but where there is intervening land between two 
tracts on one of which a mine has been opened the coal on the 
other tract is not an open mine. Westmoreland Coal Co.'s Ap- 
peal, 85 Pa. 344. 

144 



OPEN MINES 145 

Public Domain Mines All Open. 

There can be no reasonable question that all mining claims, 
whether lode or placer, located or patented on the public domain 
under the mining Acts should be considered to be "open" mines, 
as the discovery and improvements required by law would con- 
stitute them such. Mining Rights, 15th Ed. 56. 

The interest of a mining locator is equivalent to the fee simple 
as to all persons except the government. Buchner v. Malloy, 
100 Pac. 687, 155 Cal. 253; 0' Conn ell v. Pinnacle G. M. Co., 131 
Fed. 106, 140 Fed. 854. 
M. O. K.— 10. 



CHAPTER 34. 

LACHES. STATUTE OF LIMITATIONS. 

The defense of laches is peculiarly applicable to contracts con- 
cerning mines including oil and gas. Gamble v. Hanchett, 34 
Nev. 351, 126 Pac. Ill; Gaines v. Chew, 167 Fed. 630; Water- 
man v. Banks, 144 U. S. 394, 36 L. ed. 479, 12 Sup. Ct. 646 ; 
Consumers' Gas Trust Co. v. American Plate Glass Co., 162 Ind. 
393, 68 N. E. 1020. The Statute of Limitations applies to cases 
at law and laches is its equivalent in equity, the material differ- 
ence between the two being that the Statute always fixes a de- 
finite time while laches has no fixed period. Delay whether long 
or short amounts, or does not amount to laches, depending on 
several different factors. Delays and indifference to a plaintiff's 
rights always weakens his case, but it is not technical laches if 
the status has not been altered and no harm has come to the 
defendant by the procrastination. It is also the corollary of the 
expression, that time is of the essence of the contract. 

Laches is not chargeable so long as a party's rights are not 
invaded. Morse v. Smyth, 255 Fed. 981. 

Rescission. 

The party attempting to rescind a lease and option must act 
promptly upon discovery of the fraud. Hazzard v. Johnson 
(Cal. App.) 187 Pac. 121. 

Courts will not decree rescission of an oil lease assignment, to 
parties who do not offer to restore what they have received as 
consideration and fail to give any excuse for want of prompt 
action after they had knowledge of facts entitling them to re- 
scission. Duncan v. Keechi 0. & G. Co. (Okla.) 181 Pac. 709. 

The lessee is not entitled to rescission on the ground of de- 
fective title when he knew of the facts and operated the mine 

• 146 



LACHES 147 

until he found the results were not satisfactory. Hazzard v. 
Johyison (Cal. App.) 187 Pac. 121. 

Excusable Delay. 

Where suit is brought within a reasonable time after dis- 
covery of the fraud, the defense of laches does not apply. Beck 
v. Finleij (Okla.) 187 Pac. 488. 

Delay of sixteen months before suit to enforce an oil lease, is 
not laches where no facts had arisen to make its enforcement in- 
equitable. Merico-Wy owing Petroleum Co. v. Valentine, 237 
Fed. 539, 150 C. C. A. 421. And a much longer delay was held 
excusable on the facts on an accounting. Stone v. Marshall Oil 
Co., 188 Pa. 602, 41 Atl. 748, 1119, 19 M. R. 593. 

Between Locators. 

Where the original owner permits a relocator to work for ten 
years, he is barred by laches. Harvey v. Lav.rier M. Co. (Wash.) 
179 Pac. 864. 

Statute of Limitations. Trespass Not Known. 

In an action to enforce a liability ''created by law," the Statute 
runs from the date of the wrong and not from the date of the 
discovery of the wrong. Johnson v. Hinkel, 29 Cal. App. 78, 
154 Pac*. 487. 

The decisions on the point ruled in the last citation are not 
uniform. They are collated in Mining Eights, 15th ed. at page 
480. See also National Copper Co. v. Minnesota M. Co., 57 Mich. 
83, 58 Am. Rep. 333, 23 N. W. 781, 17 M. R. 44. It is easily 
surmisable that the oil under a tract might be drained by wells 
on adjoining tracts and the fact not be discovered until many 
years after. However, in such a case, the owner would have no 
right of action at any time unless he had some privity of estate 
or contract with the party who took the oil. 

When Mineral Title Severed. 

Where there has been a severance of the surface and. mineral 

M. 0. R.— 9. 



118 MORRISON'S OIL RIGHTS 

rights, the possession of one is not hostile to the other. Kings- 
ley v. Hillside Coal, etc., Co., 144 Pa. 613, 23 Atl. .250; Catlin 
Coal Co. v. Lloyd, 176 111. 275, 52 N. E. 144; 180 111. 398, 72 
Am. St. Rep. 216, 54 N. E. 214. And the same is held on a pecu- 
liar state of facts in Delaware Canal Co. v. Hughes, 183 Pa. 66 7 
63 Am. St. Rep. 743, 38 L.R.A. 826, 38 Atl. 568. 

Mining When Possession. 

That secret underground mining is not a hostile possession, 
that mining itself is proof of possession, but a clandestine entry 
is not, and that long continued possession ripens into title, see 
Mining Rights p. 477. 

Dietz v. Mission Transfer- Co., 3 Cal. Unrep. 354, 25 Pac. 423 
is a case where the oil rights had been severed. It suggests with- 
out deciding, the effect of surface possession as adverse to the 
oil which is invisible and even its existence unknown. The oil 
claimant had entered and built works which were carried away 
by a flood. He re-entered and begun work at a new place. The 
Court held that the two entries could not be tied together, as a 
trespasser has no rights beyond his pedis possessio. A rehearing 
was granted but the case seems not to have been carried further 
and it rules no other point with any satisfactory clearance. 



CHAPTER 35. 

STATUTE OF FRAUDS. 

The Statute of Frauds is of constant application on leases, 
agreements for leases and assignments of leasehold interests. 
The Statute in most states requires leases for more than one year 
to be in writing, but an oil lease is not always drawn for a de- 
finite term of years, long or short. 

An oil and gas lease in general terms must be in writing. 
BeckeU-Iseman Oil Co. v. Backer, 165 Ky. 818, 178 S. W. 1084; 
BeHart v. Enright, 93 Misc. Kep. 213, 157 N. Y. Supp. 46 ; Hel- 
ler v. Bailey, 28 Ind. App. 555, 63 N. E. 490. 

Conveyance of an interest in the underlying gas is a sale of 
an interest in land. shorn v. Arkansas T. 0. & G. Co., 103 Ark. 
175, r46 S. W. 122. 

An oil and gas lease for five years with the paying quantities 
clause, is a lease for more than five years and under Kentucky 
Statute must be recorded. Racier v. Shaffer (Ky. App.) 218 S. 
W. 292. 

An oil lease, for five years is within the Statute of Frauds 
and is not a mere license ; a contract to assign it is also within the 
Statute. Priddy v. Green, 220 S. W. 243 (Tex. Civ.). 

A lease granting "all the oil and gas in and under" the land 
must be in writing and its surrender, the same. Heller v. Bailey, 
28 Ind. App. 555. 63 N. E. 490. 

Assignment or Surrender. 

If the law requires the lease to be in writing, its assignment 
must be in writing. Kennedy v. Burns (W. Va.) 101 S. E. 156. 
Surrender of lease must be in writing unless the surrender bo 
by operation of law. Heller v. Bailey, supra. 

The terms of a written oil lease for one year may be changed 

149 



150 • MORRISON S OIL RIGHTS 

by parol. Crawford v. BcUevue, etc., N. Gas. Co., 183 Pa. 227 r 
38 Atl. 595. 

Cases Not Within. 

A partnership to deal in oil leases is not within the Statute 
of Frauds. Bird v. Wilcox, 104 Kan. 799, 180 Pae. 774. Nor 
an agreement to pay for drilling a well by giving the driller an 
interest in the lease. Haight v. Conners, 149 Pa. St. 297, 24 Atl. 
302. 

Simultaneous Records. 

Where several papers are offered together for record by dif- 
ferent persons (in this instance applications for mineral permits) 
they are entitled to be filed simultaneously. Jones v. MacCor- 
quodale (Tex. Civ. App.) 218 S. W. 59. 






CHAPTER 36. 

FRAUD. 

The physical incidents of oil and gas do not seem to bring 
up an}' questions arising- out of fraudulent assertions or conceal- 
ments which are peculiar to these minerals. The general rules 
of course apply — that fraud is never presumed, that the facts on 
which it is predicated and not the mere conclusion of fraud must 
be alleged and that it must be strictly proved. 

Plaintiff's failure to read an oil lease, such failure not charge- 
able to defendant, is no proof of fraud. And the Court cannot 
rescind for a trifling item of injury. Texas v. Keeter, 219 S. 
W. 521. 

The government is bound by the representations of its agents 
having in charge its negotiation for a forestry contract, so as to 
predicate charge of fraud or mistake on such representations 
"The government will never knowingly do wrong to any of its 
citizens*" U. 8. v. Raine- Andrews Lumber Co., 262 Fed. 787. 

The Pleading. Spirit Case. 

On allegation of fraud the facts must be set out so that the 
legal conclusions may be drawn from such facts. That defend- 
ant had alleged that spirits had informed him that oil existed 
under the land, on the facts of the case held no ground for re- 
lief. Butler v. Marston, 145 La. 42, 81 So. 749. 

Where it is alleged that stock received had no value, its return 
or offer to return should be pleaded. McEntire v. Thomason~ 
210 S. W. 563 (Tex. Civ.). 

A seven years' mining lease or any modification of the lease 
must be in writing to comply with the Statute of Frauds. Last 
Chance M. Co. v. Tuckahoe^M. Co., 202 S. W. 287 (Mo. App.,. 

Evidence. Burden of Proof. 

The burden of proof of fraud is on the party alleging it. 
The allegation of the lessee, an oil speculator that he was a pro- 
lent sale of an oil lease by the corporation, the stockholders may 
sue. BentU'j v. Zclma Oil Co. (Okla.) 184 Pac. 131. 

151 



152 MORRISON'S OIL RIGHTS 

ducer of oil, is not a material alllegation. Gillespie v. Fulton 
Oil & G. Co., 236 111. 188, 86 N. E. 219. , The burden of proof 
is on the government even on its negative averments in suit to 
set aside patent and the government is subject to the same rule 
which governs individuals, and the evidence must be clear and 
convincing. United States v. Safe Inv. Gold Min. Co., 258 
Fed. 872. 

Evidence to establish must exceed a preponderance. In re 
Georgia Steel Co., 240 Fed. 473, 474; United States v. California 
Midway Oil Co., 259 Fed. 343. 

Knowledge of Facts 

sufficient to put a prudent man upon inquiry, is constructive 
notice of the fact itself. Brink v. Canfield (Okla.) 187 Pac. 223. 

Opinions as to Value, 

as a rule are not actionable, but where fortified by any artifice 
they become so. A secret commission to one of the purchasers 
avoids the contract. Beck v. Finley (Okla.) 187 Pac. 488. 

Concealment of Strike. 

Representing contrary to the fact a well actually producing 
was a dry hole, is actionable fraud. Van Winkle v. Hinkle 
(Okla.) 186 Pac. 942. Zundelowitz v. Waggoner (Tex. Civ. 
App.) 211 S. W. 598. The same as to concealment of an oil 
strike, but resultant injury, as well as the fraud must be proved. 
Arnold v. Producers Oil Co. (Tex. Civ. App.) 196 S. W. 735. 
Subsequent discovery of oil cannot be considered on the question 
of value of the land on the issue of inadequate consideration at 
the time the sale was made. Butler v. Mart son, 145 La. 42, 81 
So. 749. 

Corporation Cases. 

Stockholders selling oil by virtue of corporate control wrong- 
fully obtained, become voluntary trustees for the other stock- 
holders and are chargeable with the market price 'of the oil 
when sold. Fredenhall v. Schroder, 188 Pac. 580 (Cal.) 

A party cannot accept a granl from a corporation after he 






FRAUD 153 

had placed himself in such position that his demands on such 
corporation belong in equity to his assignee. Priddy v. Green, 
220 S. W. 243 (Tex. Civ.). 

Contract by Convict. 

A party purchasing an oil lease from an Indian convict was 
held chargeable with whatever facts he could have learned upon 
reasonable inquiry and among others of what the records of the 
Indian office would have disclosed. Such lease will not be set 
aside where there was no imposition and the consideration not 
inadequate as the land was known at the time. That the convict 
was ignorant of the oil conditions, was one of the allegations. 
On the facts one of the leases was set aside, but otherwise as' 
to another lease in the hands of a bona fide purchaser. Moore 
v. Sawyer, 167 Fed. 826. 

Sale by Sample. 

A party contracting for lubricating oil worth over $1.25 per 
gallon was shown a sample of crude oil worth 16 cents a gallon 
as a sample of what he was buying, and so agreed to take the oil 
according to "sample. " It was held to be a fraud of no avail 
to the defendant, Maute v. Gross, 56 Pa. 250, 94 Am. Dec. 62, 
11 M. R. 123. 

Inadequacy of Consideration 

in connection with dealing with an illiterate Indian addicted to 
drink, is sufficient to set aside the lease. Brink v. Canfield 
(Okla.) 187 Pac. 223. 

Promise to Be Performed. 

The allegation that lessee represented that he would begin to 
operate in a reasonable time, is not material on a bill to cancel 
the lease, it being in contradiction to the terms of the lease and 
not omitted therefrom by fraud or mistake. Jackson v. Pure 
Oil Co. (Tex. Civ. App.) 217 S. W. 959. 

A promise made with the intention not to perform is fraud. 
But the mere failure to perform is not proof of the nonintention 
to perform. Long v. Calloway, 220 S. W. 414 (Tex. Civ.). 

Suit by Stockholders. 

Where the directors refuse to bring suit to set aside a fraudu- 
lent sale of an oil lease by the corporation, the stockholders may 
sue. Bentley v. Zrlma Oil Co. (Okla.) 184 Pac. 131. 



154 MORRISONS OIL RIGHTS 

No Relation Back. 

As aii agent had made in good faith certain oil locations his 
subsequent wrong conduct, in the nature of fraud, favoring other 
locators, does not relate back to invalidate the original loca- 
tions. United States v. California Midway Oil Co., 259 Fed. 343. 

Bona Fide Purchaser. 

The defense of bona fide purchaser is on the defendant and 
must be pleaded and proved. United States v. Poland, 251 U. S. 
221, 64 L. ed. — , 40 Sup. Ct. Rep. 127 (163) 

A mining company is not an innocent purchaser when all its 
principal officers have full knowledge of the rights of third per- 
sons. Walla Walla Oil, etc., Co. v. Vallentine, 103 Wash. 359, 
174 Pac. 980. 

The grantor in an oil and gas lease as against an innocent 
bona fide purchaser, is estopped to deny receipt of the $1 consid- 
eration. Dill v. Fraze, 169 Ind. 53, 79 N. E. 971. 

The plea of bona fide purchaser in suits to set aside patents 
is considered in United States v. Grand Canyon Cattle Co., 247 
Fed. 446, 159 C. C. A. 500, holding that it is an affirmative de- 
fense. It was sustained on the facts and the Court took judicial 
cognizance of the fact that the abandonment of mining is no 
proof that the claims were not originally taken up in good faith. 

A purchaser in good faith is not responsible against an out- 
standing grub stake contract. Kimball v. Superior Court, 38 
Cal. App. 761, 177 Pac. 488. 

Election of Remedies. 

Instead of suing for rescission, the buyer in action based on 
fraud may recover the amount of his payments. Withroder v. 
Elmore (Kan.) 187 Pac. 863. 

Waiver. 

Accepting a new contract on better terms waives the right to 
rescind the original contract. New Martinsville Oil Co. v. Bur- 
nett Oil, etc., Co., 261 Fed. 34. Reversing Banirli Oil, etc., Co. 
v. Martinsville Oil Co., 254 Fed. 481. 

The prospective production of oil by the lessee cannot be taxed. 
The oil in place is taxable only to the owner. Carter v. Tyler 
Covnty Covrt, 45 W. Va. S0<>. 4:5 L.R.A. 725, 32 S. E. 216. 



- CHAPTER 37. 

TAXATION. 

The taxation of mines or mining value or mine proceeds has 
led to many distinctions, some of them obvious and others to the 
writer very forced. 

In the first place the extraction of mineral leads to a para- 
doxical proposition. The taking of every ton of ore or ton of 
coal, or barrel of oil, of course, reduces the mineral contents of 
the land producing it just so much. On the other hand if none 
is taken, there is perhaps no proof at all that the land has any 
mineral value. The mineral content and the value are not the 
same. If an outcrop giving good assays is found the discov- 
ery shows a prospect of little or no salable value. If the finder 
sinks a shaft which more than pays its cost, he has taken so 
much of its total contents but has shown the capacity of the 
outcrop to become a producer and so has increased its value. 

It is theoretically possible that oil, coal or some other mineral 
may underlie any acre of land on earth. This theoretical pos- 
sibility does not render land taxable for its mineral values, but 
where the mineral value is known it comes under the taxing 
power not always by separate assessment but by increasing the 
market value of the land. 

Prospective Value. 

When coal is reserved but is not known to exist, it should be 
taxed at only a nominal sum. In re Colby (Iowa) 169 N. W. 
443. The mere prospective mineral value of land was held not 
taxable in Camp Phosphate Co. v. Allen (Fla.) 81 So. 503, and 
to the contrary in Washington Coal etc., Co. v. Thurston County 
(Wash.) 177 Pac. 774. 

155 



156 MORRISON'S OIL RIGHTS 

The right of the case seems to be with the above Camp Phos- 
phate decision holding prospective value, nontaxable. The rul- 
ing that it should be taxed at a nominal, value, is a compromise 
or evasion of the point. A tax sale on a nominal valuation might 
result in the loss of the mineral rights the same as if they had 
been taxed at a high valuation as tangible property. 

Separate Ownership. 

When separately owned the surface and the mineral value 
may be separately assessed. Consolidated Coal Co. v. Baker, 135 
111. 545, 12 L.R.A. 247, 26 N. E. 651; Downman v. Texas, 231 U. 
B. 353, 58 L. ed. 264, 34 Sup. Ct. 62. 

An oil lease is taxable separate from the fee in the owner. 
Raydure v. Board of Supervisors, 183 Ky. 84, 209 S. W. 19; 
Texas Corp. v. Dougherty, 107 Tex. 226, 176 S. Wl 717. But 
see Carter v. Tyler County Court, 45 W. Va. 806, 43 L.R.A. 
725, 32 S. E. 216. 

Oil and gas covered by a lease is not separately taxable. 
Kansas Natural Gas Co. v. Board of Com'rs of Neosho County, 
75 Kan. 353, 89 Pac. 750. 

An oil lease — that is to say the mineral interest in the land 
may be separately taxed under the California statute. Graciosa 
Oil Co. v. Santa Barbara County, 155 Cal. 140, 20 L.RA.(N.S.) 
211, 99 Pac. 483. 

Possessory Title. 

The possessory title to a mining claim is taxable. Forbes v. 
Gracey, 94 U. S. 762, 24 L. ed. 313, 14 N. E. 183 ; Elder v. Wood, 
208 U. S. 226, 52 L. ed. 464, 28 Sup. Ct. 263 ; Seymour v, Fisher, 
16 Colo. 188, 27 Pac. 240. But in the mining sections they are 
not generally returned or assessed unless the improvements are 
extensive. 

Reservation. 

Minerals reserved by deed are taxable. Northwestern Imp. 
Co. v. Oliver County, 38 N. D. 57, 164 N. W. 315. 



TAXATION 157 



Assessment. 



The items which go to prove taxable value of a coal mine are 
fully considered in In re State Line, etc., B. Co's Taxation (Pa.) 
107 Atl. 860. The mineral is to be added to the agricultural 
value. Palmer Co. v. Police Jury, 142 La. 1076, 78 So. 122. 

Unconscionable Assessment. 

The American Bauxite Co. paid $500,000 for Bauxite lands 
iu Arkansas. The assessor listed the property at $47,000,000. 
The report does not give the theory on which this assessment 
was made but there was no attempt to defend it. The Board of 
Equalization cut it down to $2,500,000. The County Court 
reduced it to $623,000. The Supreme Court held that the mar- 
ket value should have been the basis of assessment, enumerates 
the items on which market value may be based and ruled that 
market value meant what the lands could have been sold for. 
American Bauxite Co. v. Board of Equalization, 119 Ark. 362. 
177 S. W. 1151. 

In Mariineau v. Clear Creek O. & G. Co. (Ark.) 217 S. W. 
806, an excessive valuation was set aside, the Court enumerating 
the items which should be considered, including- the probable 
producing life of the wells and the cost of development. 

Gross Proceeds. 

A tax on the gross proceeds of sale of oil, was upheld in State 
v. Standard Oil Co., 61 Or. 438, Ann. Cas. 1914B 179, 123 Pac. 
40. 

The oil production tax is constitutional and is in addition to 
the tax on the property. Baydure v. Board of Supervisors, 183 
Ky. 84, 209 S. W. 19. ' 

Net Proceeds. 

Almost every mining state has attempted to tax the net pro- 
ceeds of mines. Plausible as the idea is, it is really only an at- 
tempt to enforce double taxation. But the Acts to this effect 



158 MORRISON'S OIL RIGHTS 

have nevertheless been generally unheld. Montana Coal & C. 
Co. v. Livingston, 21 Mont. 59, 52 Pae. 780 ; Tallon v. Vindicatory 
Consol. Gold Min. Co., 59 Colo. 316, 149 Pac. 108. 

The net proceeds tax of Idaho, basing the valuation on the net 
production of the preceding year was upheld in Hanley v. Fed- 
eral Min., etc., Co., 235 Fed. 769. 

License and Inspection Taxes. 

In Louisiana a license tax on the operator based on the oil 
production was upheld. This of course means double taxation 
but was defended on special clauses of the State Constitution. 
Standard Oil Co. v. Police Jury, 140 La. 42, 72 So. 802. Same 
holding in a sulphur case. Union Sulphur Co. v. Reed, 249 
Fed. 172. An inspection tax of ten cents per barrel of oil, 
producing revenue largely in excess of cost of production is 
void. State v. Standard Oil Co., 100 Neb. 826, L.R.A.1917D 
746, 161 N. W. 537. 

A License Tax of three per cent on the gross receipts of natural 
gas and other gas companies, was held void in City of Portland 
v. Portland Gas, etc, Co., 80 Or. 271, 156 Pac. 1070, overruling 
150 Pac. 273. 

A tax of $10 on all oil storage stations where oil was kept in 
bulk or in tanks were held void as a property tax but valid as a 
police regulation. Standard Oil Co. v. Commonwealth, 119 Ky. 
75, 82 S. W. 1020. 

License taxes on oil distributors may classify the persons sub- 
ject to them and levy different rates according to the classifica- 
tions. Standard Oil Co. v. Fredericksburg, 105 Va. 82, 52 S. E. 
817. But this discrimination must be reasonable and taxing dif- 
ferent companies on the basis of their modes of transmission 
cannot be sustained. City of Lincoln v. Lincoln Gas, etc., Co. t 
100 Neb. 182, 158 N. W. 962 ; Lincoln Gas & Electric Light Co. v. 
Lincoln, 182 Fed. 926. An exemption in favor of small gas wells 
was upheld in Los Angeles Gas, etc., Corp. v. Los Angeles, 163 
Cal. 621, 126 Pac. 594. 
• The License Mining Tax Act of Alaska Upheld. Alaska Mem- 
cm Gold Mining Co. v. Alaska, 236 Fed. 64, 149 C. C. A. 274. 



TAXATION 159 

A tag tax of one-half cent on each gallon of oil, producing a 
revenue many times in excess of the cost of inspection is void, 
beeause interference with interstate commerce and also in vio- 
lation of the State Constitution. Where the penalty would eom^ 
on every shipment the remedy at law is out of the question nm\ 
equity will relieve by injunction. The Court considered the 
suggestion that if the tax was excessive the legislature would be 
expected to amend the Statute (which is a practical denial of all 
relief) and refused to accept or act on it. W afford Oil Co. v. 
Smith, 263 Fed. 396. 

The License Tax Act of New Mexico, Session Laws of 1919, p. 
182, so far as it taxes sales of gasoline in original packages is 
void because an interference with interstate commerce. As to 
sales from broken containers it is valid. Askren v. Continental 
Oil Co., 40 Sup. Ct. Rep. 355. 

The tax known as the Kennedy Act of Texas of 1905 on oil 
dealers upheld. Southwestern Oil Co. v. Texas, 217 U. S. 114. 

Income Tax. 

A nonresident may be taxed in Oklahoma on his income from 
oil wells in that State. Shaffer v. Howard, 250 Fed. 873. Dis- 
tribution of accumulated earnings held not to be income under 
Act of Oct 3, 1913. Gulf Oil Corp. v. Lewellyn, 242 Fed. 709. 

Construction of A. C. Aug. 5, 1919, Corporation Tax Act. 
Claimed reductions for exhaustion disallowed. United^ States v. 
Biwabik Mining Co., 247 U. S. 116. 62 L. ed. 1017, 38 Sup. Ct 
462 ; Goldfield Consol. Mines Co. v. Scott, 247 U. S. 126, 62 L. 
ed. 1022, 38 Sup. Ct. 465. 

Depletion of mine by removal of ore is not a depletion of prop- 
erty for which deductions may be made. Von Baumbach v. 
Sargent Land Co., 242 U. S. 503, 61 L. ed. 460, 37 Sup. Ct. 201. 

A stock dividend (Standard Oil Company stock) is not in- 
eome, nor are the accumulated profits behind it, income. And 
the Revenue Act of 1916, in its imposition of such tax is in 
violation of the Constitution, notwithstanding the 16th amend- 
ment. Eisner v. Macomber, 40 Sup. Ct. Rep. 189. 

The commissioner refusing to make allowances for deprecia- 
tion of value of equipment, the excess tax paid under Excess 



160 MORPLSON'S OIL BIGHTS 

Act of Auo-. 5, 1909, sec. 38 (36 St. L. 112) was recovered by 
the plaintiff. Camp Bird, Lim. v. Howoert, 262 Fed. 114. 

Nonresidents. 

Enforcement of the Arizona Act attempting to tax the intan- 
gible property of foreign corporations was enjoined in Standard 
Oil Co. v. Howe, 257 Fed. 481, 483. 

The Oklahoma income tax upon the oil proceeds of nonresi- 
dents, received from Oklahoma wells upheld, altho, the gross 
production tax on the same proceeds may amount to double 
taxation. Shaffer v. Carter, 40 Sup. Ct. Rep. 221. 

An oil and gas lease on land in another State is not subject 
to inheritance tax on the decease of the lessee. Dewitt's Estate, 
in re, 109 Atl. 699 (Pa.) 

A Perpetual Lease. 

A perpetual lease to take out all the coal is a sale of the coal 
and makes the lessee or vendee the party liable for the taxes. 
Delaware, etc., R. R. Co. v. Sanderson, 109 Pa. 583, 58 Am. 
Rep. 743, 1 Atl. 394. 

Interstate Commerce. 

Crude oil in transit from state to state is under Interstate 
Commerce and not taxable. Prairie Oil & G. Co. v. Ehr- 
hardt, 244 111. 634, 91 N. E. 680. See State v. Flannelly, 96 
Kan. 372, 152 Pac. 22. But a New Jersey case held that a pipe 
line company carrying oil from Pennsylvania to New Jersey is 
not exempt on the plea of doing Interstate Commerce business. 
Tide Water Pipe Co. v. State Board, 57 N. J. L. 516, 27 L.R.A. 
684, 31 Atl. 220. 



CHAPTER 38. 

POLICE POWER. CITY ORDINANCES. 

Municipal interference and the exercise of the police power 
confront the oil operator on every side. In Pierce Oil Corp. v. 
City of Hope, 248 U. S. 498, 63 L. ed. 210, 139 Sup. Ct. 172, 
the ordinance of a small town forbidding storage of oil within 
300 feet of any dwelling was upheld under extremely severe 
conditions. It would be hard to find a spot in any city, town or 
village more than 300 feet distant from any dwelling. But in 
Smith case, 143 Cal. 368, 77 Pac. 180, an ordinance forbid- 
ding the maintenence of gas works in a sparsely settled district 
was held void. 

The quantity of gasoline storage may be regulated by ordi- 
nance. Texas Co. v. Fish (Tex. Civ. App.) 129 S. W. 188. An 
enlargement of a filling station is not a new erection. State v. 
Dauben (Ohio) 124 N. E. 232. 

The distribution of natural gas for light, heat and power is 
a business of a public nature under the control of the State. 
City of La Harpe v. Elm Tp. Co., 69 Kan. 97, 76 Pac. 448. 

A street railway company may be assessed for part of the cost 
of oil sprinkling. Henderson Traction Co. v. City of Hender- 
son, 178 Ky. 124, 198 S. W. 730. 

Public Utilities. Gas Rates. 

Gas rates may be fixed by ordinance or legislation but must 
not be so unreasonable as to amount to confiscation. City of 
Knoxville v. Knoxville Water Co., 212 U. S. 1, 53 L. ed. 371, 29 
Sup. Ct, 148 : Willcox v. Consolidated Gas Co., 212 U. S. 19, 53 
L. ed,382, 29 Sup. Ct. 192, 15 Ann. Cas. 1034, 48 L.R.A.(N.S.) 
1134; Lincoln Gas, etc., Co. v. Lincoln, 223 U. S. 349, 56 L. ed. 
466, 32 Sup. Ct. Rep. 271 ; Public Service Com. v. Brooklyn B. 
Gas Co., 189 App. Div. 62, 178 N. Y. Supp. 93. A difference of 
M. O. Px.— n. 161 



162 Morrison's oil rights 

rate to different elasses of consumers was upheld in the Will- 
cox case. And the Court will not finally act on the allegation 
of confiscatory rates until time has proved the practical results 
of the ordinance. Des Moines Gas Co. v. Des Moines, 238 U. S. 
153. State Pub. Utilities Comm. v. Springfield Gas & E. Co. 
(111.) 125 N. E. 891, is a late case reviewing the whole subject 
of regulation of compensation. 

It is intimated that the falling off in the supply of natural 
gas, may be considered by the Public Utilities Commission. Pub- 
lic Service Commission v. Iroquois N. Gas Co. (App. Div.) 179 
N. Y. Supp. 230. Both danger of exhaustion of supply and 
expenditures on pipe line were passed on in Clarksburg Co. v. 
Public Service Comm. (W. Va.) 100 S. E. 551. 

Rates for sale of natural gas fixed by the Public Utilities Com- 
mission held confiscatory because the commission had failed to 
allow for the diminishing supply. Landon v. Public Utilities 
Commission, 2M Fed. 152. 

The State cannot impose commercially impossible conditions 
upon a gas company nor impose unconscionable penalties. Con- 
solidated Gas Co. v. City of New York, 157 Fed. 849. See Knox- 
ville Gas Co. v. Knoxville, 261 Fed. 283. And the Courts will 
give relief against confiscation rates. City of Pueblo v. Public 
Utilities Comm. (Colo.) 187 Pac. 1026. But in Muscatine Light- 
ing Co. v. City of Muscatine, 256 Fed. 929, the Court goes so far 
as to hold that if by change of conditions the rates have become 
confiscatory, the Courts can afford no relief. To same effect is 
Bronx Gas Co. v. Public Service Comm., 212 N. Y. Supp. 172, 
218. See Knoxville Gas Co. v. Knoxville, 261 Fed. 283. 



CHAPTER 39. 

INSPECTION. 



Mine Inspection. 



The right of inspection, including survey, of any sort of mine 
in litigation under supervision of the Court, has been so fre- 
quently decided as to be beyond question. The authorities may 
be found in the Mining Rights 15th ed. p. 473. 

The Court may order the inspection of gas wells in controversy 
before it. Culbertson v. Iola P. Cement Co., 87 Kan. 529. 125 
Pac. 81. * 

Oil Inspection. 

The inspection of oil on the market for any commercial pur- 
pose, is exercised under the police power. Fees for such in- 
spection are only legal when limited to the cost of the service and 
they cannot rightfully be made a source of revenue which would 
be equivalent to a special tax. But the constant tendency of 
legislation is to make this cost so large as to amount to a source 
of revenue and under the Red C. decision below cited from 222 
U. S. ; such covert attempt is practically without judicial remedy, 

Inspection fees intended for revenue, on oil imported into the 
State, are excessive and unconstitutional. Standard Oil Co. v. 
Graves, 249 U. S. 389, 63 L. ed. 412, 39 Sup. Ct. 320, Reversing 
Standard Oil Co. v. Graves, 94 Wash. 291, 162 Pac. 558 and 
Distinguishing General Oil Co. v. Cram, 209 U. S. 211, 52 L. ed. 
754, 28 Sup. Ct. 475. 

Oil inspector fees may be lawfully imposed by the State. It 
is not a Tax but a charge for services rendered. Louisiana State 
Board of Health v. Standard Oil Co., 107 La. 713, -31 So. 1015. 

Oil inspected and adjudged below standard may be mixed 
with other oil to bring it up to the standard. Commonwealth v. 
? 163 



164 MORRISON'S OIL RIGHTS 

Standard Oil Co., 129 Ky. 546, 112 S. W. 632. And oil inspected 
in another State may be exempted from the Statute. Robinson, 
In re, 28 Tex. App. 511, 13 S. W. 786. 

Altho oil has been inspected and passed, if the dealer receives 
information that it is defective, he is required to take further 
precautions. Chapman v. Pfarr, 145 Iowa 196, 123 N. W. 992. 

Gasoline is subject to the inspection Act under the general 
description of a "fluid that can be used for illuminating pur- 
poses." Burkhardfs Adm'r v. Striger (Ky.) 67 S. W. 270. 

The oil inspection Acts of the States generally are reviewed in 
Bed "C" Oil Mfg. Co. v. Board of Agriculture, the Court refus- 
ing to inquire whether the inspection fees amounted to revenue 
and ruling that a party complaining of the Regulations of the 
State Board must apply for relief to that board. 222 U. S. 380, 
56 L. ed. 240, 32 Sup. Ct. 152. 

Letters patent of the United States do not protect a burning 
fluid from the State Inspection. Patterson v.. Kentucky, 97 U. 
S. 501, 24 L. ed. 1115. 



CHAPTER 40. 

PIPE LINES. 

"The only practical method of transporting natural gas is by 
a pipe line." Haskell v. Cowham, 187 Fed. 403, 109 C. C. A. 
235. 

This adjunct to the production of natural gas and almost to 
the same extent of oil came into use as soon as oil and gas be- 
came commercial products on a large scale. The methods of 
carriage by flat boats and cartage in barrels were both costly 
and wasteful. Pipe Line Companies are recognized everywhere 
as common carriers and as ways of necessity. 

Across Public Domain. 

The right to construct them over the public domain was 
granted by several Acts of Congress. (See 41 L. D. 138 and 43 
L. D. 110.) And they are covered again by Sec. 28 of the Oil 
Leasing Act of 1920. 

Common Carriers. 

A pipe line company is a common carrier, Prairie Oil & Gas 
Co. v. United States, 204 Fed. 798 and may exercise the right of 
eminent domain. Consumers Gas Trust Co. v. Harless, 131 Ind. 
446, 15 L.R.A. 505, 129 N. E. 1062; Carothers v. Philadelphia 
Co., 118 Pa. 468,' 12 Atl. 314 ; Johns ton's Appeal (Pa.) 7 Atl. 167, 
15 M. R. 556; Carnegie Natural Gas Co. v. Siviger, 72 W. Va. 
557, 46 L.R.A.(N.S.) 1073, 79 S. E. 3; Bloom field, etc., Light Co. 
v. Richardson, 63 Barb. (N. Y.) 437. 

A pipe line devoted to the public transportation of oil is a 
common carrier, and it cannot by contract for future trans- 
portation, or pledge, prevent its regulation by the State as a 
public utility. Producers Transp. Co. v. Railroad Commission, 
251 U. S. 228, 64 L. ed. 166, 40 Sup. Ct. 130. 

165 



166 MORRISON'S OIL RIGHTS 

A pipe line is an "internal improvement" under the West Vir- 
ginia Corporation Acts. West Virginia Transp. Co. v. Volcanic 
Oil & C. Co., 5 W. Va. 382. 

The State cannot arbitrarily declare a private pipe line to 
be a common carrier. But where such a company begins to 
serve the public generally it comes under the Public Utilities 
Law. Producers Tr. Co. v. R. R. Corn-in., 40 Sup. Ct. Rep. 131. 

Condemnation. 

The measure of damages on condemnation of a pipe line is 
stated in McGregor v. Equitable Gas Co., 139 Pa. 230, 21 Atl. 
13, and the evidence, in Davis v. Jefferson Gas Co., 147 Pa. 130, 
23 Atl. 218, and Wallace v. Jefferson Gas Co., 147 Pa. 205, 23 
Atl. 416. 

The State may authorize the condemnation of the right of 
way for a pipe line under the streets of a city. City of La 
Harpe v. Elm T. Gas Co., 76 Pae, 448, 69 Kan. 97. 

The measure of damage for pipe line across railroad is the fair 
market value of the land. Color Oil and Gas Co. v. Franzell, 
128 Ky. 715, 33 Ky. L. R, 98, 109 S. W. 328, 122 S. W. 188. 

The question of the public need in a case of eminent domain 
is generally one for the Court and not for the jury. Carnegie 
Natural Gas Co. v. Swiger, 72 W. Va. 557, 46 L.R.A.(N.S.) 1073, 
79 S. E. 3. 

The line of the pipe cannot be changed to cover new ground 
without further condemnation. Lowe v. Pure Oil Co., 260 Fed. 
704. 

Incidents. Interstate Commerce. 

The pipe line has the right to support from the underlying 
coal beds. Davis v. Jefferson Gas Co., 147 Pa. 130, 23 Atl. 218; 
Perm. Gas Coal Co. v. Versailles Fuel Gas Co., 131 Pa. 522, 19 
Atl. 933. And is real estate and taxable as such. State v. Berry, 
52 N. J. L. 308, 19 Atl. 665. And when it carries from State 
to State it comes under the Interstate Commerce provision of the 
constitution. Landon v. Public Utilities Comm. 2:54 Fed. 152. 

The transportation of natural gas from State to State is 



PIPE LINES 167 

interstate commerce, but its rates of sale may be regulated by 
State law. Pa. Gas Co. v. Public Service Commission, 40 Sup. 
Ct. 279. 

"Where gas was found on a tract bisceted by a right of way 
the owner has a way of necessit}- to pipe his gas under the rail- 
road. Uhl v. Ohio River B. Co., 34 S.E. 934, 47 W. Va. 59. 

Right to Abandon. 

It has a right to abandon the easement and remove its pipe 
line, but must fill up the trench and is liable for any injury to 
crops by the Act of removal. Clements v. Philadelphia Co., 184 
Pa. 28, 39 L.R.A. 532, 38 Atl. 1090. 

Where the oil lessee was -granted the right to construct a pipe 
line, such right was construed to be limited to the benefit of the 
demised well and was not exclusive of the right to allow others 
to be licensed to pipe line across the tract. Brookshire Oil Co. 
v. Casmalia Banch, etc., Co. 156 Cal. 211, 103 Pac. 927. 

Limiting Pressure. 

The State has power to regulate and limit the pressure to be 
used in transmitting natural gas. The Act was upheld, Owens 
J., dissenting. Jamieson v. Indiana N. Gas, etc., Co., 128 Ind. 
555, 12 L.R.A. 652, 28 N. E. 76. This case is very full on the 
incidents peculiar to natural gas. 

In Addleman v. Manufacturers' Light, etc., Co., 242 Pa. 587, 
89 Atl. 674, 255 Pa. 580, 100 Atl. 444, the relation of the di- 
ameter of the tubing to the pressure is considered. 

Negligence. 

Natural gas companies are held to great care to maintain safe 
pipes and to keep them inspected and are liable in damages for 
explosion of escaping gas. H ashman v. Wyandotte Gas Co., 83 
Kan. 328, 111 Pac. 468. And for allowing the contents to escape, 
percolate and destroy springs. Hauck v. Tidewater P. L. Co., 
153 Pa. 366, 26 Atl. 644, 34 Am. St. Rep. 110, 20 L.R.A. 642. 

The company was held for the consequences of a break by a 



168 



MORRISON'S OIL RIGHTS 



third party for neglect to discover it in time. Lee v. Vacuum 
Oil Co., 54 Hun, 156, 7 N. Y. Supp. 426. 

When Not Liable. 

The pipe line is not the proximate cause of an accident where 
the oil in it burst by an overflow of foreign oil. Behling v. South 
West Pennsylvania Pipe Lines, 160 Pa. 359, 40 Am. St. Rep. 724, 
28 Atl. 777. Nor where a steam shovel struck a buried pipe line 
and was damaged by a resulting fire. Clement v. United States 
Pipe Line Co., 253 Pa. 187, 97 Atl. 1070. 

Delivery to Pipe Line. 

Where one of several parties interested had delivered oil to a 
pipe line it was held that the delivery was prima facie valid 
and plaintiff's only remedy was upon an accounting with his 
cotenants or at most the recovery of the value of his fractional 
interest. Enterprise Oil & Gas Co. v. National Transit Co., 172 
Pa. 421, 51 Am. St. Rep. 746, 33 Atl. 687, 18 M. R. 312. And 
see Gillette v. Mitchell (Tex. Civ. App.) 214 S. W. 619. 



CHAPTER 41. 

INTERSTATE COMMERCE. TRANSPORTATION. 

Interstate Commerce. 

Transportation of oil or gas from state to state is Interstate 
Commerce, but the police power remains to the state. Pennsyl- 
vania Gas Co. v. Public Service Commission, 122 N. E. 260, 
225 N. Y. 397. And it does not lose its interstate character by 
being mingled with local gas. Landon v. Public Utilities Com- 
mission, 234- Fed. 152. And the State may regulate the rates of 
transportation. Tucker v, Missouri Pac. B. Co., 82 Kan. 222, 
108 Pac. 89. 

The State has no power to fix the price of natural gas carried 
from one State to another, nor to prohibit its transportation from 
state to state. In re Pennsylvania Gas Co., 103 Misc. Rep. 37, 
169 N. Y. Supp. 820. State v. Indiana, etc., Min. Co., 120 Ind. 
575, 6 L.R.A. 579, 22 N. E. 778; Manufacturers Gas, etc., Co., 
v. Indiana, etc., Oil. Co., 155 Ind. 545, 53 L.R.A. 134, 58 N. E. 
706, 21 M. R, 102; West v. Kansas N. Gas Co., 221 U. S. 229, 55 
L. ed. 716, 31 Sup. Ct. 564, 35 L.R.A. (N.S.) 1193 (Affirming 
Kansas Natural Gas Co. v. Haskell, 172 Fed. 545) ; Haskell v. 
Kansas N. Gas Co., 224 U. S. 217, 56 L. ed. 738, 32 Sup. Ct, 
442; Haskell v. Cowham, 187 Fed. 403, 109 C. C. A. 235. 

Natural gas, carried in pipes, is as much a commercial com- 
modity as coal in the cars or petroleum in tanks. State v. In- 
diana, etc., Min. Co., 120 Ind. 575, 6 L.R.A. 579, 22 N. E. 778 ; 
Kansas N. G. Co. v. Haskell, supra; Affd., West v. Kansas N. Gas 
Co., supra. 

Common Carrier. 

Certain pipe line companies construed to be not common 
carriers. The Act of 1913, regulating pipe line companies con^ 

169 



170 MORRISON'S OIL RIGHTS 

sidered. Associated Pipe Line Co. v. Railroad Commission, 176 
Cal. 518, 169 Pac. 62, L.RA.1918C 849; Producers Transp. Co., 
v. Railroad Commission, 176 Cal. 499. 169 Pac. 59. 

A contract to allow a single common carrier the right of way 
exclusive of such rights of way as others might seek to acquire, 
is void. West Virginia Transp. Co. v. Ohio River Pipe IAne Co., 
22 W. Va. 600, 46 Am. Rep. 527. 

The carrier is liable for oil lost in shipment unless the loss was 
chargeable to the Act of God or other like* cause. Coad v. Penn- 
sylvania Ry. (Iowa) 175 N. W. 344. 

Tank Cars. 

The Railroad is not bound to furnish tank cars to carry oil. 
They are furnished by the shipper. Good reason for this is 
clearly stated in Chicago R. I. & P. Ry. Co. v. Jjawton Refining 
Co., 253 Fed. 705. 



CHAPTER 42. 

NEGLIGENCE. EXPLOSIONS AND OTHER ACCIDENTS. 

The inflammable and explosive qualities of gas and oil and 
their products have led to many suits based on accidents where 
the general law of negligence applies. Judicial notices as else- 
where stated is taken of these incidents and not only has strict 
eare been required in the use and handling, but responsibility for 
the results of this dangerous character has been held to continue 
even after the product of the well has ceased to be either oil or 
gas or their immediate derivatives. 

The explosive nature of gasoline is well considered and the 
conditions stated where danger lies, in O'Brccht v. Cedar Rapids 
Co. (Iowa) 170 N. W. 785. But there being little or no proof 
of defendant's negligence, it was held not liable. 

Flo wage from Wells. 

The defendant was held not liable for allowing oil and salt 
^ater to flow down a natural stream to the injury of a lower 
proprietor if he was free from negligence in the operation of 
his well. Ohio Oil Co. v. Westfall, 43 Ind. App. 661, 88 N. E. 
,*54. 

The same point was considered in Pfeiffer v. Brown, 165 Pa. 
267, with the outcome that the well operator was liable if he 
could have avoided the damages by reasonable care and some 
expenditure, the Court appealing to the doctrine of comparative 
loss and gain, which has the form of fairness but as it says 
brings the parties into a "debatable region." The opinion cites 
Collins v. Chartiers Gas Co., 131 Pa. 143. 

Selling One Thing for Another May Create a Liability. 

The defendant was held for consequences when it had sold 
gasoline as coal oil or kerosene. Harlow v. Propes, 102 Kan. 424, 

171 



1/- MORRISON'S OIL KAUHTS 

170 Pac. 983; Kearse v. Seyb, 200 Mo. App. 645, 209 S. W. 635. 
En the latter case the remote vendor was held in damages to 
the ultimate purchaser. It is the duty of the company to attend 
to the service pipes and it is liable for explosion resulting from 
neglect. Hahn v. Southwestern Gas Co. 145 La. — , 82 So. 199. 

When oil bought as "coal oil" was in fact a dangerous com- 
pound of coal oil and gasoline the original vendor was held for 
the ultimate consequences. Waters Pierce Oil Co. v. 'Deselms, 
212 U. S. 159, 53 L. ed. 453, 29 Sup. Ct. 270. 

The vendor is liable for result of selling gasoline as kerosene. 
McLawson v. Paragon Bef. Co., 198 Mich. 222, 164 N. W. 668. 

Storage Cases. Vapor. 

The storage of large quantities of gasoline requires care com- 
mensurate with the apparent dangers from such storage. Woods 
v. Chalmers Motor Co. (Mich.) 175 N. W. 449. 

Naphtha vapor, arising from soap, during marine shipment is 
explosive and the ship is bound to see it stored where it will 
have necessary ventilation. International Mercantile Marine Co. 
v. Fels, 164 Fed. 337. See on similar points. Standard Oil Co. 
v. Tierney, 92 Ky. 367, 36 Am. St. Rep. 595, 14 L.R.A. 677, 17 
S. W. 1025. 

It is common knowledge that crude oil and gasoline will 
emit gas. Gulf C. & 8. F. Railway Co. v. Clement, 220 S. W. 
407 (Tex. Civ.) 

Leaks, Floating Oil. 

The company is liable for a leak in the pipes which allow sXl 
the gas to escape, explode and wreck a building. Alexandria 
Mining, etc., Co. v. Irish, 16 Ind. App. 534, 44 N. E. 680. In 
Texas & N. O. B. Co. v. Bellar, 51 Tex. Civ. App. 154, 112 S. W. 
323, the railroad was held liable for fire caused by fuel allowed 
to escape from its tanks. Allowing oil to escape into a stream 
where it catches fire creates a liability for the results. Northup 
v. Eakes (Okla.) 178 Pae. 266. And where several oil wells neg- 
ligently allowed crude oil to flow into a creek which caught fire 



NEGLIGENCE 173 

and burned a barn they are jointly and severally liable. Northup 
v. Eakes (Okla.) 178 Pac. 266. 

Seepage. 

For injury to a well from a gas plant defendant is liable and 
want of negligence is no defense. Belvidere Gaslight & Fuel Co. 
v. Jackson, 81 111. App. 424. 

Below Standard. 

Defendant held for accident arising from explosion of oil due 
to its inferior quality. Schmidt v. Union Oil Co., 27 Cal. App. 
366, 149 Pac. 1014. 

Oil in Transit. 

The railroad is bound to great care in the carriage of danger- 
ous freight such as tank cars or oil in barrels. Lake Erie, etc., 
B. Co. v. Lowder, 7 Ind. App. 537, 34 N. E. 447, 747 ; Empire 
Transp. Co. v. Wamsutta Oil, etc., Co., 63 Pa. 14, 3 Am. Rep. 515. 

In Oil Creek & A. B. By. Co. v. Keighron, 74 Pa. 316, the 
railroad was held liable for letting an oil car run loose on a 
down grade. And for accident from negligent care of its gas 
tanks. Chicago, B. I. & T. By. Co. v. Bhodes, 35 Tex. Civ. App. 
432, 80 S. W. 869. But not for defective valve in tank car, where 
there was an intervening cause of the accident. Goodlander 
Mill Co. v. Standard Oil Co., 63 Fed. 400, 11 C. C. A. 253, 27 
L.R.A. 583. 

A railroad company placing an inexperienced man in charge 
of a gasoline engine is liable for resulting accident. Erie B. Co. 
v. Collins, 259 Fed. 172. 

The shipper of oil is not liable for fire caused by leak from 
the car where the shipper was only remotely connected with the 
accident. Goodlander Mill Co. v. Standard Oil Co., 63 Fed. 400, 
11 C. C. A. 253, 27 L.R.A. 583. Nor is a defendant liable where 
his oil was fired by a third person. Behling v. Southwest Penn- 
sylvania Pipe Lines, 160 Pa. 359, 40 Am. St. *Rep. 724, 28 Atl. 
777. 

The transportation company was held not responsible for ex- 



174 MORRISON'S OIL RIGHTS 

plosion of a gasoline tank mislabeled as to its contents. Gulf C. 
<f- 8. F. R. Co. v. Clement, 220 S. W. 407 (Tex. Civ.) 

Delay to cut out oil cars from a fire which had begun on other 
cars in a wreck, held negligence. Henry v. Cleveland, etc., K. 
Co., 67 Fed. 426. 

Statutory Liability. 

An Ohio Statute making a natural gas company liable for acci- 
dents arising from gas in transportation without regard to negli- 
gence was upheld in Ohio Gas-Fuel Co. v. Andrews, 50 Ohio St. 
695, 29 L.K.A. 337, 35 N. E. 1059. 

Miscellaneous Cases, 

It is negligence for an employee at a filling station, to begin 
pouring gasoline before he is certain that the customer is ready 
to receive it. Sanders v. Austin (Cal.) 182 Pac. 449. 

A pipe line crossed the highway on the surface. A heavily 
loaded wagon or truck broke the pipe, the oil escaped, caught 
fire and burned the threshing machine which it carried. The 
owner of the machine was held entitled to damages. Thompson 
v. Union Traction Co., 103 Kan. 104, 172 Pac. 990. 

In Snyder v. Philadelphia Co., 54 W. Va. 149, 102 Am. St, 
Hep. 941, 1 Ann. Gas. 225, 63 L.R.A. 896, 46 S. E. 366, the com- 
pany Avas held for frightening horses by negligently blowing off 
the well. The excessive oiling of a street was held to make the 
city liable. Kelleher v. City of Newburyport, 227 Mass. 462, 116 
N. E. 806. 

Pouring kerosene from the can into the stove is negligence per 
se. McLaivson v. Paragon Rcf. Co., 198 Mich. 222, 164 N. W. 
668. 

Parties. 

That a well was sunk by an independent contractor does not 
relieve the lessee from damages for negligence of the contractor. 
Minnetonka Oil Co. v. Haviland, 55 Okla. 43, 155 Pac. 237. 



NEGLIGENCE 175 

Rule of Evidence. 

In the suit for damages by lire from a pumping station plain- 
tiff is not bound to exclude every possible theory as to the cause 
of the fire. Bamage v. Producers, etc., Co., 259 Pa. 491, 103 
Atl. 336. 

Killing Well. 

Plaintiff had an oil well producing heavily. Defendant, ad- 
joining lessee, sank a dry well, which when open let air into 
plaintiff's well. Defendant refused to plug his dry well, which 
would have ended the injury. The Court quotes the civil law 
and holds that where keeping open the dry well does harm to 
plaintiff with no benefit to defendant a good cause exists. Hig- 
gins 0. &F. Co. v. Guaranty Co. (La.) 82 So. 206. 



CHAPTER 43. 

NUISANCE. 

The inflammable and explosive incidents of oil and gas render 
them dangerous materials and as such liable to attack under 
certain conditions as nuisances. Even mining and quarrying 
have been attacked and sometimes successfully, as nuisances. 
Cavanaagh v. Corbin Co. (Mont.) 174 Pac. 184; Brede v. Minne- 
sota, etc., Co. (Minn.) 173 N. W. 805. Fagan v. Silver, 188 Pac. 
900 (Mont.). But relief against the operation of an ordinary 
coal mine was refused in Alexander v. Wilkesbarre, etc., Co. 
254 Pa. 1, L.R.A.1917B, 310, 98 Atl. 794. 

Oil Wells. 

The charge of nuisance against the well itself has not been 
often made. Of course there must be mischievous incidents to 
enjoin the carrying on of a lawful business and such cannot 
exist unless in a built up neighborhood or under other unusual 
conditions. Injunction against the drilling of a gas well 152 feet 
from a dwelling was refused when it was not shown that it 
could not be operated so as to be harmless. Windfall Mfg. Co. 
v. Patterson, 148 Ind. 414, 62 Am. St. Rep. 532, 37 L.R.A. 381, 
47 N. E. 2, 18 M. R. 674. If there is any way -the well can be 
operated so as not to make it a nuisance it will be protected. 
McGregor v. Camden, 47 W. Va. 193, 34 S. E. 936, 20 M. R. 
274. 

Every landowner has the right to develop the natural re- 
sources of his land and in the absence of negligence is not liable 
for the necessary consequences. Brede v. Minn. Crushed Stone 
Co. (Minn.) 173 N. W. 805. This clear ruling is cited, and de- 
clared to have special application to mines, oil wells, and quar- 
ries in a case where a church unsuccessfully complained that it 
was disturbed by the noisy use of ore bins and the tramway 

176 



NUISANCE 177 

leading- from them. Arizona Hercules Copper Co. v. Protestant 
Episcopal Church Corp., 190 Pae. 85 (Ariz.). 

The mere danger of fire is not enough to prove a nuisance 
Pope v. Bridgewater Gas Co., 52 W. Va. 252, 43 S. E. 87. 

One who buys surface rights reserved under an oil lease takes 
the burden of all legitimate annoyance from the necessary opera- 
tions of the driller. Grimes v. Goodman Drilling Co. (Tex. Civ. 
App.) 216 S. W. 202. 

The pumping machinery of an oil well does not come within 
the law of attractive nuisances. Pennington v. Little Pirate Oil 
Co. (Kan.) 189 Pac. 137. 

A statute forbidding operating a well within 100 feet of a 
railroad right of way was held good, which was practically confis- 
cation without compensation. Winkler v. Anderson, 104 Kan. 
1, 177 Pac. 521. 

In this case there were two wells already sunk and producing 
oil and from the statement of facts the well of a third party was 
perilously close to these wells, so that danger of drainage was 
imminent. The Court says: "The plaintiff's lease is entirely 
valueless if the Statute be valid." The decision is placed solely 
on the police power and the reason advanced to sustain its exer- 
cise in this instance is not convincing. 

Obstructing Highways. 

The operation from the surface for oil and gas was enjoined 
as an obstruction to a highway in Boone v. Clark (Tex. Civ. 
App.) 214 S. W. 607. 

Gasoline Stations, Refineries. 

A gasoline station on a crowded street is practically declared 
a public nuisance in Oriental Oil Co. v. City of San Antonio 
(Tex.' Civ. App.) 208 S. W. 177. The same as to gasoline tanks 
under like conditions. McGuffey v. Pierce Fordyce Oil Assn. 
(Tex. Civ. App.) 211 S. W. 335; O'Hara v. Nelson, 71 N. J. Eq. 
629, 63 Atl. 842 ; Whittemore v. Baxter Laundry Co., 181 Mich. 
564, Ann. Cas. 1916C 818, 52 L.R.A.(N.S.) 930, 148 N. W. 

437. 

M. O. R.— 12. 



178 MORRISON'S OIL RIGHTS 

An oil refinery permitting its refuse to overflow lands, makes 
it a nuisance, and its owner liable in damages. Helms v. Eastern 
Kansas Oil Co., 102 Kan. 164, L.R.A.1918C 227, 169 Pao. 208. 

Gas Works. 

The erection of gas works in a residence neighborhood may 
be enjoined or may be allowed under restrictions. Cleveland v. 
Citizens' Gas L. Co., 20 N. J. Eq. 201 ; Judson v. Los Angeles, 
etc., Gas Co., 157 Cal. 168, 21 Ann. Cas. 1247, 26 L.R,A.(N.S.> 
183 ; McGill v. Pintsch Compressing Co., 140 Iowa 429, 20 L.R.A. 
(N.S.) 466, 118 N. W, 786. But to obtain damages on account 
of the nuisance of gas works, substantial annoyance must be 
proved. Sherman Gas, etc., Co. v. Belden, 103 Tex. 59, 27 
L.R,A.(N.S.) 237, 123 S. W. 119. 

Gas works have been held liable for the pollution of wells or 
springs. Columbus Gas Light & Coke Co. v. Freehand, 12 Ohio 
St. 392 ; Kinnaird v. Standard Oil Co., 89 Ky. 468, 25 Am. St. 
Rep. 545, 7 L,R.A. 451, 12 S. W. 937 (the seepage from an Oil 
Storehouse) ; Ottawa Gaslight, etc., Co. v. Grahaur, 28 111. 73. 
81 Am. Dec. 263, 35 111. 346; Anstee v. Monroe, Light & F. 
-Co., 177 N. W. 26. 

Kinsman v. Utah Gas, etc., Co. (Utah) 177 Pac. 418, was an 
action to declare the Salt Lake City Gas Works a nuisance. The 
Court denied an injunction but the individual complainants were 
allowed to recover, each his separate damages. 



CHAPTER 44. 

FIXTURES. 

Frequent disputes as to removal of the casing or of the oil 
rig, bring up questions which have become generally settled in 
favor of the lessee, that is, of the right of removal. 

What Are Removable Fixtures. 

Machinery placed on a mine is personal property and the 
owner may sell or mortgage it as such. Powell v. Blank, 141 Mo. 
App. 406,* 125 S. W. 836. . 

A combustion engine and other chattels affixed to the land 
but removable by loosening certain bolts are chattels. Reward 
Dredging Co., in re, 242 Fed. 225, 155 C. C. A. 65. 

Machinery and fixtures used for the purpose of drilling for 
oil and gas do not become permanent irremovable fixtures. 
Perry v. Acme Oil Co., 44 Ind. App. 207, 88 N. E. 859. 

Roseburg Bank v. Kamp, considers what are and what are not 
fixtures on sale of a placer mine, holding that the pipes and 
giant are not parcel of the realty. Rosenburg Nat. Bank v. 
Camp, 89 Or. 67, 173 Pac. 313. 

Whatever fixtures can be removed without injury to the realty 
may be removed — this includes ''machinery or materials used in 
drilling wells, or in pumping, storing or conveying the oil." Gil- 
lespie v. Fulton O. I. & G. Co., 239 111. 326, 88 N. E. 192. Ma- 
chinery for drilling a salt well is a removable fixture. Bewick 
v. Fletcher, 41 Mich. 625, 32 Am. Rep. 170, 3 N. W. 162, 6 M. R. 
117. 

The mortgage of a building with its appurtenances covers the 
land on which it stands and in this case its pumping plant. 
Muckle v. Hill (Idaho) 187 Pac. 943. 

The lessee had the right to remove the casing from an aban- 
doned well under a lease allowing the removal of machinery and 

179 



180 MORRISON'S OIL RIGHTS * 

fixtures. Collins v. Mt. Pleasant Oil & G. G. 85 Kan. 483, 38 

L.R.A. (N.S.) 134, 118 Pac. 54. 

Time to Remove. 

The oil rig, casing and tanks, on a forfeited leasehold belong 
to the tenant and he has a reasonable time to remove them. 
Gartland v. Hickman, 56 W. Va. 75, 67 L.R.A. 694, 49 S. E. 14; 
Mickle v. Douglas, 75 Iowa 78, 39 N. W. 198, 17 M. R, 137 ; 
Cassell v. Crothers, 193 Pa. 359, 44 Atl. 446, 20 M. R. 160. 

The Tenant has a reasonable time to remove fixtures but the 
words "at any time" in the lease, mean only a reasonable time. 
Perry v. Acme Oil Co., 44 Ind. App. 207, 88 N, E. 859. 

What amounts to reasonable time is to be ascertained from 
all the facts in the case. Gartland v. Hickman, 56 W. Va. 75, 
67 L.R.A. 694, 49 S. E. 14; Berger v. Hoerner, 36 111. App. 360, 
and where the lease read that the fixtures might be removed "at 
any time" it was held that the lessee could not wait until years 
after the lease expired. 

Eight months after abandonment is not an unreasonable time 
for lessee to enter and remove fixtures. Standard Oil Co. v. 
Barlow, 141 La. 52, 74 So. 627. 

Casing. 

The easing may or may not be a removable fixture. The lessee 
has no right to remove it where it would render the well value- 
less and the lessor may protect himself by injunction. Meyers 
v. Shertzer (Shertzer v. Myers) 82 Kan. 275, 108 Pac. 105. The 
lessee is not allowed to remove fixtures which cannot be taken 
out without destroying the well. Powers v. Bridgeport Oil Co.. 
238 111. 397, 87 N. E. 381. But in Shellar v. Shivers, 171 Pa. 
569, 33 Atl. 95, 18 M. R. 260, the casing was held to be a trade 
fixture and removable if removed in time. 

When Real Estate. 

A levy on an oil derrick engine and boiler attached to the 
realty, is to be made as a levy on real estate, and not as on per- 
sonalty. Titusville Novelty Iron Works Appeal, 77 Pa. 103. 



FIXTURES 181 

The same as to a tax sale. Johnson v. Sidey, 59 Ind. App. 678, 
109 N. E. 934. 

Contest between Lessees. 

Altho a second lease is adjudged invalid, the first lessee has 
no right to the fixtures placed by the second lessee. Linden Oil 
Co, v. Jennings, 207 Pa. 524. 56 Atl. 1074. 



CHAPTER 45. 

PUMPING. 

Pumping. 

Except in the case of flowing wells no oil can be got to the 
surface without the use of pumps. The necessity of pumps is 
so self evident that practically no legal protest has ever been 
urged against it. Certainly none has been sustained. 

Not only has the owner the right to pump but he has the right 
to use explosives to shatter the containing rock and induce an 
increased flow of oil, and may use any other artificial means to 
increase the product of his well. 

But there are limitations asserted against every abstract right 
and such a limitation was debated in a well known case in In- 
diana. 

In that State there was a statute of 1891 intended to protect 
the supposed natural pressure of gas. Under that Act defend- 
ant was restrained from producing by pumps an increased flow 
of gas from the well. Manufacturers Gas & Oil Co. v. Indiana, 
etc., Oil Co., 155 Ind. 461, 50 L.R.A. 768, 57 N. E. 912, 20 M. 
R. 672, 155 Ind. 566, 58 N. E. 851, 21 M. R. 139. Richmond 
Natural Gas Co. v. Enterprise Natural Gas Co., 31 Ind. App. 
222, 66 N. E. 782, is to the same effect. 

Both these cases refer to the presence of salt water as a danger 
to the well, but shed little light on how the facts induced the 
danger. 

In Consumers' Gas Trust Co. v. American Plate Glass Co., 
162 Ind. 393, 68 N. E. 1020, an injunction was refused against 
a pumping station to a pipe line which did not exceed 300 lbs. 
pressure and did not increase the natural pressure at the wells. 

A second case between the Manufacturs Gas & Oil Co. ami the 
Indiana, etc., Oil Co., 156 Ind. 679, 59 N. E. 169, 60 N. E. 1080. 
21 M. R. 194, decides that special injury to the property must be 

182 



PUMPING 183 

shown, and that the allegation as to use of excess pressure in 
the transportation of the gas did not show the use of excess 
pressure in its production. 

The constitutionality of the Act had already been upheld in 
Jamieson v. Indiana, etc., Oil Co., 128 lnd. 555, 12 L.R.A. 652, 
28 N. E. 76, as an exercise of the police power, the opinion en- 
larging on the dangerous properties of oil and gas. 

The Act seems to contain two independent propositions (1) 
The power to limit the pressure for the production of the gas 
and (2) The power to limit the pressure on its transportation. 
The first is a very doubtful proposition and the second seems 
entirely indefensible, the danger from explosive and other nox- 
ious qualities of these substances having very little to do with the 
prohibited pressure. Olds J., in the Richmond Co. case supra, 
tiled a dissenting opinion holding that the Act was an exercise 
of arbitrary power prohibited by the constitution, with which 
dissenting opinion many lawyers familiar with the subject mat- 
ter would thoroughly agree. 

In Jones v. Forest Oil Co., 194 Pa. 379, 48 L.R.A. 748, 44 Atl. 
1074, the Court held the use of gas pumps to be legal. 

The owner of a gas well may be restrained from pumping or 
using any other device to induce an unnatural flow into his 
own well. Manufacturers' Gas d; Oil Co. v. Indiana Natural 
Gas Co., 155 lnd. 461, 50 L.R.A. 768, 57 N. E. 912, 20 M. R. 672; 
Richmond Natural Gas Co. v. Enterprise Natural Gas Co., 31 
lnd. App. 222, 66 N. E. 782. 

The Saratoga Water Case. 

In New York an Act was passed to protect the Sanitary 
Springs at Saratoga. It forbade all pumping whatever with a 
special paragraph prohibiting the extraction of the water for 
the purpose of utilizing its carbonic acid gas so as to sell this 
gas separated from the water. The Court held, as a matter of 
course, that the prohibition of pumping was an absolute depriva- 
tion of the property rights of the owner and therefore void, but 
sustained the prohibition as to pumping for the purpose of 
extracting the carbonic acid. The decision was based on the fact 
thai in the extraction of the carbonic acid gas the mineral salts 



184 • MORRISON'S OIL RIGHTS 

of the water were wasted and the further fact that defendants 
were unreasonably diminishing the common supply. 

There is force in the first reason (if based on fact), and that 
absolute and useless waste may be prohibited has been justly and 
almost uniformly sustained, but the second reason is more de- 
batable and sugggests the question, impossible to answer: At 
what point does the one draining the mineral water or oil begin 
to take more than his legitimate supply? Haight, J., filed a dis- 
senting opinion. Hathorn v. Natural Carbonic Gas Co., 19-1 X, 
Y. 326, 128 Am. St. Rep. 555, 16 Ann. Cas. 989, 23 L.R,A.(N.S. I 
436, 87 N. E. 504, Affg. 128 App. Div. 33, 112 N. Y. Supp. 374; 
Lindsley v. Natural Carbonic Gas Co., 162 Fed. 954. 

The Act coming before the Federal Supreme Court on ap- 
peal from the last cited case, was sustained as not in violation of 
the 14th amendment and the State's construction in the Hathorn 
case was approved. Lindsley v. Natural Carbonic Gas Co., 220 
U. S. 61, Ann. Cas. 1912C, 160, 55 L. ed. 369, 31 Sup. Ct. 337. 



CHAPTER 46. 

SHOOTING WELL. 



The Right to Shoot 



The well has not been seriously questioned. In People's Gas 
Co. v. Tyner, 131 Ind. 277, 31 Am. St. Rep. 433, 16 L.R.A. 443, 
31 N. E. 59, 17 M. R. 481, it was held that the fact that such 
shooting might diminish the supply of natural gas to a neighbor- 
ing owner was no reason to enjoin the shooting. If the owner 
has the right to take the gas at all he has the right to take all he 
can get. In another suit between the same parties it was al- 
leged that defendant had brought a large quantity of nitro gly- 
cerine to his well with the intention of shooting it. The Court 
repeated its ruling in the first case that he had the right to 
.shoot the well even if it brought in gas from other ground, but 
that he had no right to bring the explosives into a neighborhood 
where it might do injury. It will of course be conceded that no 
person has a right to keep such explosives stored in a building 
neighborhood, but if he had the right to shoot the well he cer- 
tainly had the right to bring in the explosives for that purpose. 
This well was 1000 feet deep and the explosion itself could do 
no surface injury. Tyner v. Peoples Gas Co., 131 Ind. 408, 31 
X. E. 61. 

When Not Bound to Shoot. 

In a "paying quantity" case it was held that a party was not 
bound to shoot the well where it shjowed only a trace of oil. "A 
torpedo may make a well flow more freely but it will not pro- 
duce oil from barren sand." Rice v. Ege, 42 Fed. 661, 664, 16 
M. R. 179. 

185 



186 MORRISON'S OIL RIGHTS 

Premature Explosion. , 

Where a contractor agreed to shoot a well but by a premature 
explosion the well was ruined the contractor was held not liable 
to the owner in the absence of proof of negligence. Davidson v. 
Humes, 188 Pa. 335, 41 AtJL 649. This report contains a full 
and interesting account of the process of shooting a well. A 
similar decision is East End Oil Co. v. Pennsylvania Torpedo 
Co., 190 Pa. 350, 42 Atl. 707, holding that the maxim res ipsa 
loquitur did not apply. 



CHAPTER 47. 
WASTE OF OIL OR GAS. 

The Wanton Waste 

of gas has been prohibited by statute in several States, and a 
right of action for such waste may arise in favor of the lessor. 
Talbott v. Southern Oil Co., 60 W. Va. 423, 55 S. E. 1009. Or 
even in favor of one who has only an interest in the common gas 
field. Calor Oil & Gas Co. v. Franzell, 128 Ky. 715, 36 L.R.A. 
(N.S.) 456, 109 S. W. 328. And exemplary damages may be 
awarded for malicious waste. Louisville Gas Co. v. Kentucky 
Heating Co., 117 Ky. 71, 111 Am. St. Rep. 225, 4 Ann. Cas. 355, 
70 L.R.A. 558, 77 S. W. 368. 

An Indiana Act allowed only two days to confine the gas or 
oil before becoming liable to a penalty, and the statute was held 
valid. Given v. State, 160 Ind. 552, 66 N. E. 750; Ohio Oil Co. 
v. Indiana, 177 U. S. 190, 44 L. ed. 729, 20 Sup. Ct. Rep. 576, 
20 M. R. 466. 

The wanton waste of gas gives a cause of action to any party 
injured. Louisville Gas Co. v. Kentucky Heating Co., supra. 

Equity may enjoin waste or damages may be recovered as be- 
tween claimants of conflicting rights to the wasted oil. Gillespie 
v. Fulton O. & G. Co., 236 111. 188, 86 N. E. 219. And the State 
may enjoin the waste of gas as a nuisance. State v. Ohio Oil Co., 
150 Ind. 21, 47 L.R.A. 627, 49 N. E. 809, Affirmed Ohio Oil Co. 
v. Indiana, 177 U. S. 190, 44 L. ed. 729, 20 Sup. Ct. 576, 20 M. 
R. 466. The malicious waste of mineral water was enjoined in 
Gug)wn v. French Lick, etc., Co., 163 Ind. 687, 68 L.R.A. 175, 
72 X. E. 849. And conviction may be had under the penal Act 
on the same subject. Bailey v. State, 163 Ind. 165, 71 N. E. 655, 
Commonwealth v. Trent, 117 Ky. 34, 4 Ann. Cas. 209, 77 S. W. 
390. It was refused on general principles when without malice 
in Hague v. ^Yhccler, 157 Pa. 324, 37 Am. St. Rep. 736, 22 L.R.A. 
141, 27 Atl. 714. 

187 



188 MORRISON'S OIL RIGHTS 

The gas waste Statute will not be enforced at the suit of a 
private individual altho this does not bar his personal action 
for special injury. Arnold v. Garnett Light Co. (Ariz.) 174 
Pac. 1027. 

Plugging- the Well. 

The Kentucky Act to compel the plugging of natural gas wells 
not in use was enforced in Commonwealth v. Trent, 117 Ky. 34, 
4 Ann. Cas. 209, 77 S. W. 390. 

The Indiana Statute is referred to in a suit between individ- 
uals where a party had agreed to plug a well. Only an "owner" 
under the Statute is penalized for not plugging. McDonald v. 
Carlin, 163 Ind. 342, 71 N. E. 961. 

Adjoining owners may plug a well which the owner has failed 
to plug. Commonwealth v. Trent, 117 Ky. 34, 4 Ann. Cas. 209, 
77 S. W. 390. 

The Ohio Act seems to be drawn not merely to prevent the 
escape of the oil and gas, but to require filling with cement to 
protect the surrounding gas field. State v. Oak Harbor Gas Co., 
53 Ohio St. 347, 41 N. E. 584. 

Under the Kansas Act requiring abandoned oil wells to be 
plugged, the duty devolves on the owner and not the operator. 
The Court in construing a criminal Statute will not add omitted 
words on the ground that the reason of the case would apply 
to the operator as well as to the owner who should have been 
included in framing the Statute. State v. Foster, 189 Pac. 953 
(Kan.). 

Flambeaux Lights. 

The Act forbidding waste of natural gas in flambeaux lights is 
constitutional. Townsend v. State, 147 Ind. 624. 62 Am. St. 
Rep. 477, 37 L.R.A. 294, 47 N. E. 19. 

The wasteful use of natural gas in flambeaux has been super- 
ceded by more economical methods and a contract to furnish gas 
will not be construed to allow flambeaux. Hall v. Philadelphia 
Co., 72 W. Va. 573, 78 S. E. 755. The same subject is discussed 
in Saltsburg Gas Co. v. Borough of Saltsburg, 138 Pa. 250, 10 
L.R.A. 193, 20 Atl. 844. 



CHAPTER 48. 

JURISDICTION. 

Jurisdictional Questions. 

There are few points that arise under this head, not common 
to all kinds of property. On the point of jurisdiction where the 
Courts of one State are called on to adjudicate on oil production, 
it has been held that a receiver may be appointed for an oil and 
gas lease beyond the jurisdiction. Huston v. Cox, 103 Kan. 73, 
172 Pac. 992. 

Specific performance of an agreement for an oil lease in an- 
other State was denied in Wilhitc v. Skelton, 5 Ind. Terr. 621, 
82 S. W. 932, but the contrary was ruled on a pipe line contract 
in Texas Co. v. Central Fuel OH Co., 194 Fed. 1, 114 C. C. A. 21. 

The jurisdiction depends generally upon the familiar distinc- 
tion between transitory and local actions which is discussed in 
Peyton v. Desmond, 129 Fed. 1, 63 C. C. A. 651, where Timber 
Trespass in Wisconsin was allowed to be tried in Minnesota. It 
cites two cases : Ellenwood v. Marietta Chair Co., 158 U. S. 105, 
39 L. ed. 913, 15 Sup. Ct. 771, and Stone v. United States, 167 
U. S. 178, 42 L. ed. 127, 17 Sup. Ct. 778, which seem to allow the 
action where it is trover and to deny it where the suit is for the 
original trespass. 

The Court in Massachusetts refused to entertain a suit for 
ore taken by trespass from a mine in Arizona. Arizona, etc., Co. 
v. Iron Cap Co. (Mass.) 124 N. E. 281. 

To any one familiar with the subject of either oil or ore taken 
by alleged trespass, the unfairness and oppression which would 
result in most eases by allowing trial in a distant state, is per- 
fectly manifest whether the action be for the original taking or 
for the conversion of the mineral. 

189 



190 MORRISON'S OIL RIGHTS 

On a partnership accounting the Court, having jurisdiction 
of the parties, may decree the disposition of mining leases out- 
side the State. Apple v. Smith (Kan.) 185 Pac. 903. 

A federal Court has jurisdiction to relieve against fraud, al- 
tho the subject matter of the case is in a foreign country, where 
it has acquired personal jurisdiction over the defendant. Vac- 
uum Oil Co. v. Eagle Oil Co., 154 Fed. 867, an oil trade mark 
case. 



CHAPTER 49. 

EJECTMENT. 

History of the Action. 

Ejectment is a form of action for the recovery of real estate 
— of mines or any other corporeal hereditament capable of de- 
livery by the sheriff. It is a writ of an origin in as early as the 
reign of Edward IV. if not earlier. Its history is given in 3 
Blackstone 199, and ontside of legal authorities a clear idea of 
it is to be learned from Warren's celebrated novel "Ten Thousand 
a Year." 

To recover in this action, the plaintiff must be entitled to the 
possession and must win on the strength of his own title which 
in general must be the legal title ; damages follow recovery in a 
suit for mesne profits and under statutes a losing defendant 
having made improvements under bona fide color of title, may 
offset them in such action. 

The code purports to abolish the action eo nomine, but its in- 
cidents being indestructible, survive and are constantly referred 
to in suits styled "actions for the recovery of real estate" or by 
some other verbiage — which purport to simplify, but really 
complicate the ancient forms of action. 

Right to Jury Trial. 

Parties claiming the same land by hostile titles are litigants 
entitled to jury trial but some of the cases under this head, are 
suits where Courts of equity under color of chancery jurisdic- 
tion attempt to decide the whole controversy and to deny the 
fundamental right to trial by jury. 

It is the proper action wherever the right of possession is at 
issue between lessor' and lessee of oil or gas lands or between the 
owner or lessee and any party asserting a hostile title, except 
where as in Illinois there comes an arbitrary distinction against 
this class of leases. 

191 



192 MORRISON'S OIL RIGHTS 



Where the Action Lies. 



Ejectment will lie for recovery of a coal mine or of any incor- 
poreal hereditament of which the sheriff can deliver possession. 
Kirk v. Mattier, 140 Mo. 23, 41 S. W. 252. 

A lease for the sole purpose of working for petroleum and 
other minerals carries a corporeal interest on which ejectment 
will lie. Barker v. Dale, 3 Pittsburg 190, Fed. Cas. No. 988, 8 
M. R. 597. 

A person having a license to search for oil such as necessitates 
his taking possession of the premises has such possession as will 
maintain ejectment. Dark v. Johnston, 55 Pa. 164, 93 Am. Dec. 
732, 9 M. R. 283. 

Where defendants, oil lessees, are in possession, the plaintiff 
must bring ejectment. Williams v. Fowler, 201 Pa. 336, 50 
Atl. 969. 

Ejectment will lie against a mining lessee so breaching his 
covenants that the lease has become forfeit. Kirk v. Mattier, 
140 Mo. 23, 41 S. W. 252. 

The plaintiffs were lessees of oil property. The defendants 
were mere squatters. The Court denied them the right to prove 
that plaintiffs were not in lawful possession because they had 
forfeited their lease, that being a question solely between the 
lessor and his lessee. Hartley v. Phillips, 165 Pa. St. 325, 30 
Atl. 842. 

A lease demising and letting certain land for mining purposes 
is not a mere license and the lessee may maintain ejectment 
under it. Barnsdall v. Bradford Gas Co., 225 Pa. 338, 26 L.R.A. 
(N.S.) 614, 74 Atl. 207. The opinion cites many of the previous 
Pennsylvania cases on this point but not Union Petroleum Co. v. 
Bliven Petroleum Co., 72 Pa. 173, which seems to hold contra. 

No Jurisdiction in Equity. 

When defendant is in possession sinking for oil, equity has no 
jurisdiction, the remedy being at law. California Oil dfr Gas Co. 
v. Miller, 96 Fed. 12. Equity will not allow a bill for discovery 
to take the place of ejectment for an oil well— when there are 
none of the exceptional incidents which give equity jurisdiction : 



EJECTMENT 193 

the remedy is at law. Erskine v. Forest Oil Co., 80 Fed. 583, 18 
M. R. 297 ; Messimer's Appeal, 92 Pa. 168 ; Long's Appeal, 92 
Pa. 171. 

The action may be maintained by the owner against a tres- 
passor altho the claims have been leased to another. Thompson 
v. Undenuood (Ark.) 211 S. W. 164. 

Where It Does Not Lie. 

Ejectment will not in Illinois lie in favor of an oil lessee. 
Watford Oil, etc., Co. v. Shipman, 233 111. 9, 122 Am. St. Rep. 
144, 84 N. E. 53 ; Gillespie v. Fidton Oil, etc., Co., 236 111. 188, 
86 N. E. 219; Guffey v. Smith, 237 U. S. 101, 113, 59 L. ed. 856; 
35 Snp. Ct. 526. The Guffey case in citing these Illinois cases 
holds that equity will protect the lessee in default of such rem- 
edy at law. 

Undesignated Drill Sites. 

When the lessee had the right to drill on certain specified sites 
on a demised tract and the right to drill elsewhere only where 
further sites Avere designated, he had no such possession of such 
other sites not designated, as to sustain ejectment — altho he has 
the right to damages against others taking oil from such non 
designated sites. Duffield v. Rosemweig, 144 Pa. 520, 23 Atl. 4. 

Adverse Claim Suits. 

In an adverse claim suit against an oil placer, each party must 
stand on and prove his title. Phillips v. Brill, 17 Wyo. 26, 95 
Pac. 856. 

A complaint supporting the adverse may be amended from an 
equitable form to quiet title, to the form of an ejectment suit. 
Green v. Davis (Colo.) 185 Pac. 369. 

Set-Off. 

A defendant in ejectment against whom the land has been re- 
covered who, under claim of right haa sunk an oil well, is en- 
titled to retain out of the proceeds of the well the cost of sinking. 
Phillips v. Coast, 130 Pa. 572, 18 At 1 , 998. 
M. 0. R.— 13. 



CHAPTER 50. 

INJUNCTION, RECEIVER. 

An injunction to stay waste has been allowed from time imme- 
morial but a distinction had been made that naked trespass 
would not be enjoined. Flamang's case, unreported, cited in 
Mitchell v. Dors, 6 Vesey, Jr. 147, 7 M. R, 250 is said to be the 
first instance where this distinction was set aside and trespass 
enjoined. 

It has now become the undisputed practice to allow an injunc- 
tion and in a proper case appoint a receiver whenever irrepar- 
able injury to a mine is threatened, and oil and gas wells are 
mines within the rule. The limitations to the relief are that the 
complainant's title must be clear or if disputed he must bring 
an action at law to make it good. 

And it is not allowed when the defendant is entirely solvent 
so as to be able to respond in damages, or when greater injury 
would result to defendant than good to plaintiff nor where there 
has been inexcusable delay. 

And from the mere fact of the presence of equity incidents, the 
Court cannot deny to the defendant the right to defend his title 
at law, nor can he be deprived of possession by decree. Bracken 
v. Preston, 1 Pin. (Wis.) 584, 44 Am. Dec. 412, 7 M. R, 267; 
Brennan v. Gaston, 17 Cal. 374, 375, 7 M. R, 426. 

It is a harsh remedy and only to be resorted to in an urgent 
ease. Suit v. A. Hochstetter Oil Co., 63 W. Va. 317, 318, 61 S. 
E. 307; United States v. Honolulu Consol. Oil Co., 249 Fed. 167. 
And is a matter of discretion in a case of conflicting equities. 
Texas Pac. Coal & Oil Co. v. Howard (Tex. Civ. App.) 212 S. 
W. 735. 

Parties. 

In suits by lessees against lessees to restrain taking oil the 

194 



INJUNCTION 195 

lessors of both sides are necessary parties. Steelsmith v. Fisher 
Oil Co., 47 W, Va, 391, 35 S. E. 15; Moore v. Jennings, 47 #. 
Va. 181, 34 S. E. 793. See South Venn. Oil Co. v. Miller, 175 
Fed. 729, 99 C. C. A. 305 ; Pyle v. Henderson, 55 W. Va. 122, 
46 S. E. 791. 

Where a lessor has without right repudiated a first lease and 
let a second to a new party, the allegation that such new party 
is starting a well on the demised premises, with the usual proper 
averments, states a case for injunction against the second lessee. 
Consumers' Gas Trust Co. v. Crystal W. G. Co., 163 Ind. 190, 
70 N. E. 366. 

When all the gas consumers are parties in interest they need 
not be made parties but may be represented by the municipality. 
San Francisco Gas, etc., Co. v. San Francisco, 164 Fed. 884. 

When the plaintiff's right is limited in time, an injunction 
should not extend beyond the expiration of that time. Advance 
Industrial Supply Co. v. Eagle Metallic Co., 109 Atl. 771 (Pa.), 

General Principles. Pleading. 

Oil lessees should not be enjoined on doubtful facts. Hicks v. 
American National Gas Co., 207 Pa. 570, 65 L.R.A. 209, 57 Atl. 
55. And a preliminary injunction ought not to issue to pre- 
vent sinking for oil where the sinking would be of benefit to 
the complainant instead of an injury. French v. Brewer, 3 
Wall. Jr. 346, Fed. Cas. No. 5,096, 11 M. R. 108. 

All the facts are to be considered on petition to enforce for- 
feiture for failure to sink and the petition should negative all 
the inferences which would suggest denial of such relief. The 
refusal of injunction was upheld. Emde v. Johnson (Tex. Civ. 
App.) 214 S. W. 575. 

Where plaintiff's title is undisputed he may enjoin the extrac- 
tion of gas by one who has no right to it, without necessity of 
suit to try the title. Columbia Gas & Electric Co. v. Moore, 81 
W. Va. 164, 93 S. E. 1051. 

Preliminary injunction when allowed and when to be refused 
in contest between oil lessees. Poterie Gas Co. v. Poterie, 153 Pa. 
10, 25 Atl. 1107 ; Poterie v. Poterie Gas Co., 153 Pa. 13, 25 Atl. 
1107. 



196 MORRISON'S OIL RIGHTS 

Equity lias no jurisdiction on bill for injunction to decide the 
title properly triable in ejectment by a jury. Er shine v. Forest 
Oil Co., 80 Fed. 583, 18 M. R, 297 • California Oil & Gas Co. v. 
Miller, 96 Fed. 12. 

Remedy at Law Inadequate. 

Injunction will lie because damages are not sufficient remedy 
against party wrongfully taking natural gas. Indianapolis Nat- 
ural Gas Co. v. Kibbey, 135 Ind. 357, 35 N. E. 392, 17 M. R. 677. 

When a party enters on land under a void lease, (one made 
by a guardian without proper authorization) and drills for oil, 
he is subject to perpetual injunction and to cancellation of the 
lease and the cause is to be held for all incidental relief. The 
point made against the ruling was that there was a remedy at 
law, but the Court held that such remedy was inadequate. Has- 
kell v. Sutton, 53 W. Va. 206, 44 S. E. 533. 

It is no defense to an action to enjoin the lessor from interfer- 
ence with the lessee, that a remedy at law exists; the suggested 
remedy of unlawful detainer being wholly inadequate. Wright 
v. Gillespie, 261 Fed. 46. 

Irreparable Injury. 

The unlawful removal of oil or gas is an irreparable injury. 
Bettman v. Harness, 42 W. Va. 433, 36 L.R.A. 566, 26 S. E. 271, 
18 M. R. 500; Moore v. Jennings, 47 W. Va. 181, 34 S. E. 793. 

Injunction to restrain the taking of oil will not lie where the 
alleged trespasser is solvent and there is no threatened irrepara- 
ble injury. Equity will not interfere where ejectment is the 
proper remedy. Ershine v. Forest Oil Co., 80 Fed. 583, 18 M. 
R. 297. In this case the peculiar incident is noted that while 
defendant was charged with taking complainant's oil the evidence 
tended to show that such taking prevented it being drained by 
third parties. 

Against Drilling or Cutting Off Gas. 

The erection of a drilling rig necessarily implies the intent to 
remove any oil or gas which might be discovered. Such an al- 



INJUNCTION 197 

legation justifies a temporary injunction it not being neces- 
sary at that period in the case, to show all that is required on 
the final hearing. Risch v. Burch, 175 Ind. 621, 95 N. E. 123. 

Injunction will lie to prevent cutting off supply of natural gas. 
Simpson v. Pittsburgh Plate Glass Co., 28 Ind. App. 343, 62 N. 
E. 753. And the essentials of the complaint in such a case are 
stated in Xenia Real Estate Co. v. Maey, 147 Ind. 568, 47 N. E. 
147. 

The mere anticipation of danger from fires is not enough to 
enjoin the drilling of a new well, eighty feet distant from an 
already producing well. Pope Bros. v. Bridgewater Gas Co., 
52 W. Va. 252. 

Against Drainage, 

An oil lessee or his assignee may be protected by injunction 
against others draining demised tract. Duffield v. Hue, 136 Pa. 
602, 20 Atl. 526; Duffield v. Rosenzweig, 144 Pa. 520, 23 Atl. 
4 ; WWimnseK v. Jones, 43 W. Va, 562, 64 Am. St. Rep. 891, 38 
L.R.A. 694, 27 S. E. 411, 19 M. R, 19 ; Moore v. Jennings, 47 W. 
Va. 181, 34 S. E. 793; Smith v. Boot, 66 W. Va. 633, 30 L.R.A. 
(N.S.) 176, 66 S. E. 1005; Gillespie v. Fulton Oil & Gas Co., 236 
111. 188, 86 N. E. 219; Elk Fork Oil & Gas Co. v. Jennings, 84 
Fed. 839; Logan Natural Gas, etc., Co. v. Great Southern Gas, 
etc., Co. 126 Fed, 623, 61 C. C. A. 359. 

On motion to enjoin the drilling of an oil well the Court will 
consider the danger of drainage from outside wells the possible 
loss to the plaintiff and the damage to the party who has started 
to drill. Texas Pac. Coal <& Oil Co. v. Howard (Tex. Civ. App.) 
212 S. W. 735. 

Instances Where Allowed. 

Lessee of the exclusive right to drill may enjoin the sinking 
of a well on a right of way crossing the demised tract. Con- 
sumers' Gas Trust Co. v. American Plate Glass Co., 162 Ind. 
393, 68 N. E. 1020. 

The forcible removal of a pipe line will be enjoined. Wichita 
Snitiral Gas Co. v. Ralston (Ralston v. Wichita Natural Gas Co.) 



198 MORRISON'S OJL RIGHTS 

81 Kan. 86, 105 Pac. 430. But the construction of a pipe line 
nearly finished will not be enjoined, the remedy in damages be- 
ing complete. Consumers* Gas Trust Co. v. American Plate 
Glass Co., 162 Ind. 393, 68 N. E. 1020. 

Drilling wells within 200 ft. of buildings contrary to stipula- 
tion of lease was enjoined in Kelly v. T. W. Phillips Gas <& Oil 
Co., 262 Pa. 412, 105 Atl. 631. And the storage of gasoline in a 
frame building locality in O'Hara v. Nelson, 71 N. J. Eq. 629, 
63 Atl. 842. 

When Denied. 

Injunction in a proper case, may be used to protect against 
breach of terms of lease where legal remedy is inadequate, but 
not where only nominal damages could be recovered. Advance 
Oil Co. v. Hunt (Ind. App.) 116 N. E. 340. 

The Court will not protect by injunction a lessee where lease 
contains the surrender clause. The surrender clause does not 
make the lease invalid but would defeat specific performance and 
as the Court holds, forbids injunctive relief. Ulrey v. Keith, 
237 111. 284, 86 N. E. 696, citing Watford Oil & Gas Co. v. Ship- 
man, 233 111. 9, 122 Am. St. Rep. 144, 84 N. E. 53. 

The doctrine that because of certain unilateral elements in 
the contract, equity will not afford relief by specific perform- 
ance to the oil lessee, is according to equity precedents. But the 
further sequence that such a lease altho legal will not be pro- 
tected in equity against a trespasser as held above was repudi- 
ated by the Federal Supreme Court, citing this Keith case, in 
Guffey v. Smith, 237 U. S. 101, 114, 59 L. ed. 856, 35 Sup. Ct. 
526, followed by Washburn v. Gillespie, 261 Fed. 41. 

Injunction was refused against the drilling of an oil well 
through the spaces of a coal mine, defendant being required to 
take proper precautions against the escape of gas into the mine. 
Armstrong v. Auen, 17 M. R. 392, 21 Pittsburgh Legal Journal 
395. And it was refused against drilling through worked out 
coal beds or through possible deep coal beds not known to exist. 
Bend v. Venture Oil Co., 48 Fed. 248. 

The decrease in the supply of natural gas was considered as a 
defense to injunction sought by a customer for nohsupply in 



IxV JUNCTION 199 

Black Lick Mfg. Co. v. Salisbury Gas Co., 139 Pa. 448, 21 Atl. 
432. 

Decree Cannot Change Possession. 

The Court has no right to so decree by injunction as to de- 
prive a party of possession. Bettman v. Harness, 42 W. Va. 
433, 36 L.R.A. 566, 26 S. E. 271, 18 M. R. 500. An exception to 
this rule is that a mandatory injunction may issue where pos- 
session has been taken by violence or in contempt of a Court 
order. Sprague v. Locke, 1 Colo. App. 171, 28 Pac. 142; Cole 
v. Cady, 2 Dak. 29, 3 N. W. 322. 

A preliminary 7 injunction is intended to preserve the present 
status and has no right to anticipate the final decree, especially 
as to transfer of possession. Bettman v. Harness, supra, . 

Lessees Fixtures. 

An injunction against a defeated party should not cover his 
personal property not attached to the freehold or which could 
be removed without injury to the freehold. Gillespie v. Fulton 
0. d' G. Co., 239 111. 326, 88 N. E. 192; Cassell v. Crothers, 193 
Pa. 359, 44 Atl. 446. 

Damages Not Waived. 

Injunction to prevent 'waste and damage for loss of gas maj r be 
allowed but the suit to enjoin of itself is no waiver of damages. 
Louisville Gas Co. v. Kentucky Heating Co., 132 Ky. 435, 111 
8. W. 374. 

Attempting Self -relief . 

The lessor in a gas lease has no right to turn off the gas by 
his own xVct, but if injured, must apply to the Courts. State 
v. Moore, 27 Ind. App. 83, 60 N. E. 955, 21 M. R. 401. 

Receiver. 

A receiver for oil wells will not be appointed except in an 
urgent case and not where its practical effect is to destroy the 



200 MORRISON'S OIL RIGHTS 

lease where no intentional breach has been made and no irre- 
parable damage being done. Chicago & A. Oil, etc., Co. v. 
United States Petroleum Co., 12 M. R. 570, 57 Pa. 83. 

The Court may appoint a receiver to see that the claims arc 
saved to the rightful owner by the performance of the annual 
labor. Nevada Sierra Oil Co. v. Home Oil Co., 98 Fed. 673, 20 
M. R, 283. 

The royalty is a first charge on the funds coming into the 
hands of the receiver. Allison v. Coal Creek & N. R. Coal Co., 
87 Tenn. 60, 9 S. W. 226. 

Pay for Tools. Costs. 

The receiver should pay compensation for use of tools and 
machinery and a party not benefited should not be charged with 
receiver's costs. Midland Oil Co. v. Turner, 179 Fed. 74, 102 
C. C. A. 368 ; United States v. Midivay, etc., Oil Co., 232 Fed. 619. 



CHAPTER 51. 

TRESPASS, TROVER. 

The Codes purport to abolish the forms of action but their 
distinctions are inherent and remain under any system of plead- 
ing. Trover lies for the value of personal property wrongfully 
converted by defendant : Trespass for the- act of taking* it, altho 
in both the measure of damages may be the same. This distinc- 
tion is stated in Peyton v. Desmond, referred to under jurisdic- 
tion page 189. 

The owner of the land cannot maintain trover for oil extracted 
from the realty by a part}' in possession under color of title. Na- 
tional Transit Co. v. Weston, 121 Pa. 485, 15 Atl. 569, 17 M. R. 
143. A note to the case in the Mining Reports cites the authori- 
ties sustaining this principle of law. See also Mining rights 15th 
ed. 432. 

Oil extracted by a wrongdoer remains the owner's property. 
Hail v. Reed, 15 B. Mon. (Ky.) 479, 11 M. R. 103; Hughes v. 
United Pipe Lines, 119 N. Y. 423, 23 N. E. 1042. 

Natural gas extracted from the earth and put into pipe line 
is personal property and where the valves were opened and the 
gas tapped it was a conversion of the same. Crystal Ice, etc., Co. 
v. Marion Gas Co., 35 Ind. App. 295, 74 N. E. 15. 

For the measure of damages in trespass and for conversion 
of Oil see chap. 54. 

201 



CHAPTER 52. 

SPECIFIC PERFORMANCE. 

There is nothing in the nature of oil and gas contracts to pre 
vent decree for specific performance when the proper foundation 
for such relief exists. But they have been constantly refused 
on unilateral contracts not binding the complainant to perform- 
ance on his part. 

Bill Must Allege Consideration. 

In a specific performance case against a vendor, it is necessary 
to allege that he received an adequate consideration. Ehrhart v. 
Mahony (Cal. App.) 184 Pac. 1010. 

When Granted. 

Specific performance of contract to give or to assign an oil 
lease may be decreed. Colm v. Francis, 30 Cal. App. 742, 159 
Pac. 237; King v. 6 ants (Okla.) 186 Pac. 960. A covenant to 
furnish gas for heat and light may be enforced. Hall v. Phila- 
dephia Co., 72 W. Va. 573, 78 S. E. 755. 

Expenditure on Permanent Improvements 

under promise of a deed will justify a bill for specific perform- 
ance. This is so decided in the clearest terms in a marriage en- 
gagement contract case. Neale v. Neales, 9 Wall (U. $.) 1, 19 
L. ed. 590. . 

Bids Advertised For. 

When a mine owner advertises for bids on a lease and the offer 
contained in the advertisement is accepted, the intended lessee 
lias the right to enforce specific performance of the lease on the 
usual terms and the lessor cannot insist on new and arbitrary 

202 



SPECIFIC PERFORMANCE 203 

terms such as the sinking of a 600 foot shaft. Cochrane v. Jus 
tice M. Co., 16 Colo. 415, 26 Pae. 780. 

When Denied. 

An ordinary contract for the sale of all the oil from a certain 
well, will not be specifically enforced, nor its sale to others en- 
joined, the plaintiff having a complete remedy at law for dam 
ages. Simms v. Southern Pipe Line Co. (Tex. Civ. App.) 195 
8. AY. 283. But it was allowed under the strong facts in Texas 
Co. v. Central Fuel Oil Co., 194 Fed. 1, 114 C. C. A. 21. Equity 
will not decree specific performance of a contract which is not 
certain, fair and just, nor" where jierformance by the complain- 
ing party is entirely optional ; applying this rule because the oil 
lease contained the surrender clause. Mellton v. Cherokee Oil, 
etc., Co. (Okla.) 170 Pac. 691; Watford Oil and Gas Co. v. Ship- 
man, 233 111. 9, 122 Am. St. Rep. 144, 84 N. E. 53. 

Furnishing gas from a foreign well is neither possession nor 
part performance in a specific performance case. Hancock v. 
Diamond Plate Glass Co., 162 Lid. 146, 70 N. E. 149. 

Equity will not decree specific performance of a contract which 
is j lot fair or where performance by the complainant is entirely 
optional, altho the contract be good at law, and there is no suffi- 
cient ground for its cancellation. Federal Oil Co. v. Western 
Oil Co., 121 Fed. 674, 57 C. C. A. 428, 22 M. R. 429, afiirming, 
112 Fed. 373, 22 M. R, 25 ; Superior Oil & Gas Co. v. Mtlm, 
25 Okla, 809, 108 Pac, 545, 138 Am. St. Rep. 942. 

The presence of a surrender clause defeats the right to specific 
performance before the lessee has so far performed, that specific 
performance against itself could be decreed. Hill Oil & Gas Co. 
v. White, 53 Okla. 748, 157 Pac. 710; Superior Oil <& Gas Co. v. 
Mehlin, 25 Okla. 809, 138 Am. St. Rep. 942, 108 Pac. 545 ; J\far- 
ner v. Page, 59 Okla. 259, 159 Pac. 264. 

The lease provided that if a well was not commenced at once, 
the lessee should pay $8.75 per month during the delay; there 
was the usual royalty but no limit as to time. It was held that 
the contract contemplated immediate exploration, that the small 
rental was merely compensation for delay and that the terms of 



-04 MORRISON'S OIL RIGHTS 

the contract were too onesided for specific performance. Fed- 
eral Oil Co. v. Western Oil Co., supra. 

The Court will not decree performance of a contract to as- 
sign oil leases where the contract would require continual super- 
vision by the Court and the personal services of the parties 
which could not be enforced. Synder v. Wilder, 84 So. 104 
(La. J. 

Calling for Incorporation. 

Specific performance of a contract to organize a company to 
develop an oil lease refused when the agreement was to organize 
a corporation and only an unincorporated company had been 
formed. Kennedy v. Burns (W. Va.) 101 S. E. 156. And it 
will be refused where the contract anticipates action of the Cor- 
porate Board. Ellis v. Treat, 236 Fed. 120, 149 C. C. A. 330. 

Laches. 

Unreasonable delay and notice of outstanding equities will bar 
specific performance. Lowther Oil Co. v. Miller-Sibley Oil Co., 
53 W. Va. 501, 97 Am. St. Rep. 1027, 44 S. E. 433, 22 M. R, 656 
Or waiting to learn the results of prospecting for oil value. Mer 
rill v. Rocky Mountain Cattle Co. (Wyo.) 181 Pac. 964. 

Danger of Eviction 

is an excuse for nonpayment of purchase money until the selle..' 
furnishes bond to protect against the eviction. Jennings-Hey~ 
wood Oil Snyd. v. Home Oil, etc., Co., 113 La. 383, 37 So. 1. 

Allowing Time to Complainant. 

And where option holder was to obtain consent to assignment, 
the decree may allow time to procure the assent. Mackey, etc., 
Co. v. United States Gypsum Co., 244 Fed. 275. 



CHAPTER 53. 

PARTITION. 

A mining claim may be partitioned. Hughes v. Devlin, 23 Cal. 
501, 12 M. R. 241 ■ Aspen M. Co. v. Bucker, 28 Fed. 220.. But 
not the mere right to mine and take out ore. Smith v. Cooley, 
65 Cal. 146, 2 Pac. 880. And when between mining partners, 
the decree should include accounting and dissolution. Nisbet v. 
Nash, 52 Cal. 540. 

An estate in the minerals, the right being severed from the sur- 
face right, is partible. Canfield v. Ford, 28 Barb. 336 ; Smith v. 
Jones, 21 Utah 270, 60 Pac. 1104. 

In Hall v. Vernon, 47 W. Va. 295, 81 Am. St. Rep. 791, 49 
L.R.A. 464, 34 S. E. 764 it was held that there could be no parti- 
tion by surface lines between the joint owners of the oil and gas 
not owning the surface, but only by sale and division of the 
proceeds. The opinion learnedly presents the difficulties in the 
way of partition by metes and bounds. It is cited and followed 
in Preston v. White, 57 W. Va. 278, 50 S. E. 236. The same rul- 
ing was made in Lenfers v. Hanke, 73 111. 405, 24 Am. Rep. 
263, 5 M. R. 67. 

Partition was denied on account of the fugacious character of 
oil in Watford Oil & Gas Co. v. Shipman, 233 111. 9, 122 Am. St. 
Rep. 144, 84 N. E. 53. But in the later case of Ziegler v. Brenne- 
man, 237 111. 15, 86 N. E. 597, the right to partition of such lands 
is apparently recognized. 

Oil land cannot be partitioned in kind, that is by metes and 
bounds. Gulf Ref. Co. v. Hayne, 138 La. 555, Ann. Cas. 1917D, 
130, L.R.A.1916D, 1147, 70 So. 509 • Dangerfield v. Caldwell, 151 
Fed. 554, 81 C. C. A. 400. 

Partition of an oil lease was denied in Beardsley v. Kansas N. 
G. Co., 78 Kan. 571, 96 Pac. 859 on the ground that personal 
property was not covered by the Partition Act. 

Where there is a well on the ground which partition would 

205 



206 MORRISON'S OIL BIGHTS 

give to one leaving to the other only the nonproductive part of 
the tract, the reason against surface partition is obvious, but 
where there has been no well already sunk, the fact that it may 
be oil territory would seem no sufficient reason to defeat parti- 
tion by metes and bounds. 

An agreement to secure partition of oil property should be 
carried out promptly on account of the incidents peculiar to such 
lands. Emery v. League, 31 Tex. Civ. App. 474, 72 S. W. 603. 

The working of the mine may be enjoined pending the parti- 
tion suit. Bainey v. H. C. Frick Coke Co., 73 Fed. 389. The 
licensee of one cotenant in a mine cannot call for partition. Bos- 
ton Franklinite Co. v. Condit, 19 N. J. Eq. 394. And a lessee is 
not bound by a partition to which he is not a party. Dv.ke v. 
Hague, 107 Pa. 57. 



CHAPTER 54. 

MEASURE OF DAMAGES. 

In Trespass Cases. 

In suits to recover for oil taken by trespass, that is, the taking 
of oil which only the plaintiff had the right to take, the measure 
of damages is the same as for ore mined by trespass, depending 
on the circumstances; if taken by inadvertance or under bona 
fide claim of title the measure is the profit, but if taken by wil- 
ful wrong no deductions are allowed. Central Coal, etc., Co. v. 
Penny, 173 Fed. 340, 97 C. C. A. 600, reviews the items of mitiga- 
tion and Montana Co. v. St. Louis M. Co.; 147 Fed. 897, 78 C. 
C. A. 33 contains instructions on this point which were affirmed. 
The authorities are collated in Mining Rights, 15th ed. 446, 685. 
In Stone v. Marshall Co., 208 Pa. 85, 101 Am. St. Rep. 904, 65 
L.R.A. 218 where natural gas had been mingled with other gas, 
without keeping account of it, the facts amounting to fraud, the 
extreme rule as in case of confusion of goods, was applied as the 
measure of recovery. Where the gas had been fed to a pipe as 
one out of 60 wells one-sixtieth of the total product carried by 
the line was allowed. Great Southern Gas Co. v. Logan N. G. 
Co., 155 Fed. 114, 83 C. C, A. 574. 

The measure of damages for oil taken by trespass depends up- 
on whether taken by a wilful wrongdoer or in good faith under 
claim of right. In the first case it is the full value of the min- 
eral, in the latter the cost of mining is to be deducted. The 
fugacious character of oil adds no qualification to this rule. Bry- 
son v. Crown Oil Co., 185 Ind. 156, 112 N. E. 1. 

No deductions, for willful trespass in removing coal. North 
Jellico Coal Co. v. Helton, 219 S. W. 185 (Ky.). 

In trespass for oil taken the measure of damages is not the 
amount of oil lost to plaintiff but the depreciation in value of 

207 



208 MORRISON'S OIL RIGHTS 

his lease. The difficulty of proving such damages in such case 
stated. Duffield v. Bosenzweig, 144 Pa. 520, 23 Atl. 4. 

Where oil or gas is taken without wrongful intent, defendant 
is entitled to deduct the cost of mining. Campbell v. Smith, 180 
Ind. 159, 101 N. E. 89. 

An ousted lessee has a right of action for damages and the 
amount of damages depends largely upon the question of good 
or bad faith in the taking. Backer v. Venn. Pub. Co., 162 Fed. 
627, 89 C. C. A. 419. 

On an accounting in a contest between first and second lessees 
the defendants were allowed costs of improvements and operation 
before notice of the rights of the first lessee and after such date 
were not to be credited with such items. Guffey v. Smith, 237 
U. S. 101, 59 L. ed. 856, 35 Sup. Ct. 526 ; Loeb v. Conley, 160 Ky. 
91, Ann. Cas. 1916B 49, 169 S. W. 575. 

The value of the oil in the ground, as tested by the royalty, 
is the measure of damages for oil taken by trespass but under 
claim of title in good faith. Turner v. Seep, 167 Fed. 646 ; Mid- 
land Oil Co. v. Turner, 179 Fed. 74, 102 C. C. A. 368. 

The date of conversion and not the date of the judgment is 
the date at which the value of the oil is to be determined. Russell 
v. Producers Oil Co., 146 La. 481, 83 So. 773. 

Where oil is taken with full knowledge of plaintiff's title, no 
expense of mining can be deducted and plaintiff is entitled also 
to interest. Pittsburgh & W. Va. Gas Co. v. Pentress Gas Co. 
( W. Va.) 100 S. E. 296. 

In Dyke v. National Transit Co., 49 N. Y. Supp. 180, 22 App. 
Div. 360 where no expenses were allowed, the case was reversed m 
with comments on the injustice of the ruling. The Court says : 
"The value of the oil as it lay in the earth is the full and true 
measure of the plaintiff's damages." This is eminently true, but 
such value unlike the value of coal or ore can only be got at, 
where the quantity taken is unknown, by deducting the cost 
from the value of the oil pumped. 

Where coal or ore is taken the cubic contents of the space 
worked out is usually known and the value of the coal or ore 
removed from such space can be approximate^ calculated, an 



MEASURE OF DAMAGES 209 

incident which is obviously absent from every case of oil tres- 
pass. 

Distinction between Oil and Ore. 

"If oil be not utilized at the proper time it may be ]ost for- 
ever" by reason of others operating nearby. Not so with a sta- 
tionary mineral: it remains for fntnre development. Bradford 
Oil Co. v. Blair, 113 Pa. 83, 57 Am. Rep. 442, 4 Atl. 218. 

This distinction is obvious and is mentioned incidently in 
Daughetee v. Ohio Oil Co., 263 111. 518, 105 N. E. 308. On breach 
of covenant to mine ore or coal the damage is only the loss di- 
rectly incident to the breach and the owner will get the coal or 
ore by future working. But where the oil has been drained, its 
value in a proper case should be allowed, because it has become 
a total loss. 



Toss of Profits. Value of Lease. 

Where the lessee has been ousted by the lessor, conjectural 
damages cannot be allowed and loss of profits must be specifically 
proved. Bokoshe, etc., Coal Co. v. Bray, 55 Okla. 446, 155 Pac. 
226. The value of an oil lease may be shown by proof of the 
value of similar adjoining lease. Peden Iron & Steel Co. v. Jen- 
kins (Tex. Civ. App.) 203 S. W. 180. 

Damages for Nonproduction. Failure to Operate. 

Where the lessee has breached his covenant to operate a well, 
the Courts agree that it is impossible to ascertain the exact 
amount of damages, but they widely disagree as to what is the 
proper measure by which to approximate the damages. The case 
of Daughetee v. Ohio Oil Co., 151 111. App. 102, is the only one 
which gives a practical ruling with reasonable clearness. The 
Trial Court instructed the jurj*- to find the quantity of oil which 
the lessee did produce and subtract from it the quantity which he 
should have produced, and give to plaintiff lessor his royalty, 
one eighth of the difference. This was approved in the decision 
affirming the lower Court (263 111. 518, 105 N. E. 308), with the 
M. O. R.— 14. ~ 



210 MORRISON'S OIL RIGHTS 

observation that the fact that the damage could not be ascer- 
tained with exactness was no reason for denying any relief. 

The Court further held that the fact that the oil still remained 
in the ground, the property of the lessor, was no defense to the 
action. 

Bradford Oil Co. v. Blair, 113 Pa. 83, 57 Am. Rep. 442, 4 
Ail. 218, was a similar case. A lessee was bound to sink protec- 
tion wells which he failed to sink. The Trial Court gave an 
instruction that the jury should ascertain "how much more oil 
he ought to have received than he actually did receive" then to 
ascertain its value, and deduct the cost of production which 
would seem to cover the entire profit, instead of the lessors roy- 
alty on the production. This is probably qualified by other ex- 
pressions in the instructions. The report of the case below is 
confusing and the Review Court added nothing to relieve the 
obscurity. 

In McClay v. Western Pa. Gas Co., 201 Pa. 197, 50 Atl. 978, 
21 M. R. 760, the sublessee was bound either to work the well 
or to put it in shape for the lessee to work. He did neither. The 
measure of damages was held to be the full value of the royalty 
which the well should have produced during the entire term. 
This royalty was to be fixed by the "probable production." 

In Indiana Oil, Gas &■ Dev. Co. v. McCronj, 42 Okla. 136, 140 
Pac. 610, $8,000 damages were given apparently for failure to 
produce what the well properly managed should have brought. 
The Court held that the attempt to fix the damages was a mere 
guess, the land being spotted and every well of the many sunk 
on the tract, differing from the others in its capacity. 

Pleading. 

"Where the right to the oil depended on the construction o* 
a deed, which was construed against the defendant, it was held 
for the full price received for the oil sold, without deduction of 
expenses because the right to deduction was not pleaded. Gladys 
City Oil, etc., Co. v. Bight of Way Oil Co. (Tex. Civ. App.) 137 
S. W. 171. This case seems to discard the rule both of the com- 
mon law and of the so-called reform Codes, which do not re- 
quire evidence to be pleaded. 



MEASUKE OF DAMAGES 211 

2¥et Profits Allowed. 

Coal mine allowed to recover net profits as damages for fail- 
lire to deliver electric power. Coal District Power Co. v. Kaiff 
Coal Co. (Ark.) 217 S. W. 449. 

Act of Court. 

Where oil wells have been seized by a bankruptcy Court, lessee 
is not liable in damages, while performance prevented by the 
Court. Mvnscij v. Marnet Oil, etc*, Co. (Tex. Civ. App.) 199 B. 
W. 686. 

Damages too Remote. 

Possible danger of explosion from gas is an item too remote 
to be considered in cases of alleged danger to the surface crops 
or to a coal vein through which the well passes. Manufacturers' 
Natural Gas Co., etc. v. Leslie (Ind. App.) 51 N. E. 510; Rend 
v. Venture Oil Co., 48 Fed. 248. 

For Loss of Lease. 

Lessor was to receive one half of what the lease sold f or, if it 
was assigned. It was in bulk with much other property. The 
Court held that it was not a case of confusion of goods and that 
the plaintiff must show what his particular lease, one of several 
was worth. Moherman v. Anthony, 103 Kan. 500, 175 Pac. 676. 

Where a defendant is liable for allowing leases to be lost by 
default, the measure of damages was treated as the value of the 
leases at the time the right of action accrued and experts were 
allowed to testify to the acreage value. The witnesses varied 
widely but the Court said — "we know of no better method of 
proving the value of property of the character here involved." 
Millan v. Bartlett, 78 W. Va. 367, 89 S. E. 711. In Duffield v. 
Bosenzweig, 144 Pa. 520, 23 Atl. 4, the difference in value before 
and after the injury was committed was taken as the measure of 
damages. This was an action against the lessor where the lessor 
had wrongfully given a second lease. Estimates of quantity oJl 
oil lost, that is, which might have been lifted under the lease, 



212 MORRISON'S OIL RIGHTS 

were discarded as mere guesses. Duffield v. Rosenzweig, 144 Pa. 
520, 23 Atl. 4. 

Removal of Casing. Drilling Contracts. 

The defendants breached that clause of the lease which for- 
bade removing the casing from the well. The well was 3600 ft. 
deep and had found no oil. The plaintiff claimed that he was en- 
titled to recover the cost of replacing the casing (which would 
have been as much as the cast of a new well) and would have 
been of no value if done. The Court ruled that the barren con- 
dition of the well could not be overlooked and that the plaintiff 
could only recover the value of the casing when removed from the 
well. Johnson v. Henkel, 29 Cal. App. 78, 154 Pac. 487. The 
Court further held that the Statute compelling owners to with- 
draw the casing from abandoned wells had no application to the 
facts of the case at bar. 

On breach of a drilling contract plaintiff is entitled to recover 
the rent of a string of tools kept idle as a direct consequence of 
the breach. Terrell Co. v. Davis, 188 Pac, 676 (Okla.). 

Pipe Line. 

The measure of damages for the destruction of a pipe line 
includes the value of the pipe destroyed and the value of the oil 
lost by reason of plaintiff's inabilhy to market it and the fall 
in the market value. But that the plaintiff was prevented for a 
certain period from delivering oil to its customers would not 
necessarily sustain the conclusion that so much oil was lost or 
that it was damaged to the extent of its value. Brookshire 
Oil Co. v. Casmalia, etc., Co., 156 Cal. 211, 103 Pac. 927. 

Mesne Profits after Execution Sale. 

In Dobbins v. Economic Gas Co. 189 Pac. 1073, it was held 
that the purchaser at foreclosure sale on a mortgage given by 
a public utility gas company was entitled to the mesne profits 
subsequent to the sale. But that the purchaser was not entitled 
to a writ of assistance to cover an auxiliary generating plant 



MEASURE OF DAMAGES 213 

used by the company. Lowe v. Los Angeles Suburban Gas Co. 
189 Pac. 1084 (Cal.).' 

Recognizing Wrong Lessor. 

Where the lessees paid the royalty to the wrong landlord on 
account of a litigated boundary dispute and had mingled the oil 
with other oil into a pipe line, they were held to account for the 
oil produced, found by approximation, and not for the whole 
amount turned into the pipe line. Russell v. Producers Oil Co., 
146 La. 481, 83 So. 773. 



CHAPTER 55. 

INSURANCE. 

As soon as the use of oil for heat and light became common, 
the insurance companies in their forms of policies began to re- 
strict its use or storage. 

The words "refined coal or earth oils" cover kerosene. The 
opinion recites its history — but under the facts of the case, it 
was held that its use did not avoid the policy. Bennett v. North 
British Ins. Co., 81 N. Y. 273, 37 Am. Rep. 501, 8 Daly 471. 

In Buchanan v. Exchange Fire Ins. Co., 61 N. Y. 26 it was 
held that "rock and earth oils" included kerosene. But its pro- 
hibition may be nullified by the lighting clause. The opinion re- 
cited that it was proved that kerosene is not properly classified 
as an inflammable liquid. In the Mark case the Court says : 
Burning fluid cannot mean "every fluid that will burn, whale oil 
will burn." Putnam v. Commonwealth Ins. Co., 4 Fed. 753, 18 
Blatchf. 368. 

It might be observed that the word inflammable should be cau- 
tiously construed. As a matter of fact almost every object in the 
vegetable world and every creation of man's labor, not strictly 
metallic, is combustible and more or less inflammable. 

Permission to use gasoline, altho prohibited in terms, may be 
inferred from the general scope of the policy and the necessity 
for its use in the gasoline stove which was one of the items in- 
sured. American Central Ins. Co. v. Green, 16 Tex. Civ. App. 
531, 41 S. W. 74. Naphtha may be used for lighting purposes 
altho its storage is prohibited. Putnam v. Commonwealth Ins. 
Co., 4 Fed. 753, 18 Blatchf. 368. 

Loss by fire following explosion may be covered altho loss from 
explosion is excluded. German Am. Ins. Co. v. Ilyman. 42 Colo. 
156, 16 L.R,A.(N.S.) 77, 94 Pac. 27. 

Where an explosion follows a fire the explosion is only an in- 
cident to the fire. Western Ins. Co. v. Skass, 64 Colo. 342. 

214 



INSURANCE 215 

Whore the explosion was caused by the fire and not the fire by 
the explosion the company is liable for the whole loss. Possini 
v. St. Paul Fire Ins. Co. 188 Pac. 564. 

Keeping a Ford car witli some gasoline in it was held to de- 
feat an insurance policy in Morgan v. Germania Fire Ins. Co., 
104 Kan. 383, 179 Pac. 330, 3 A.L.R, 794. The note to the A.L.R. 
gives the cases which hold to the contrary. 



CHAPTER 56. 

INDIANS. 

The main importance of this subject is confined to Oklahoma 
but the rights of the Indians in mineral lands are referred to 
in innumerable Acts of Congress covering special reservations 
most of which have become obsolete by purchase of the lands. 
Very little oil value has been shown on the reservations out- 
side of Oklahoma. In 47 L. D. 261, are printed regulations and 
forms of mining leases on unalloted land on Indian reservations 
in Arizona, California, Idaho, Montana, Nevada, New Mexico, 
Oregon, Washington and Wyoming. See Comp. L. sees. 4221 A - 
4221S. 

The Congressional Acts below mentioned are mere skeletons 
giving the power to the Secretary of the Interior to represent 
the Indian mineral lands in Oklahoma and the regulations from 
his office promulgated by circulars are practically the law which 
controls. 

Under several Acts of Congress the Indian allottees in Okla- 
homa are protected in their oil and gas interests, by placing 
them under regulations of the Interior Department. 

sages. 

The Act of June 28, 1906 (34 Stat. L. 539, 543) refers to the 
Osage Indians and under it regulations were promulgated by 
circulars of August 26, 1915, May 22, 1916, July 8, 1916 and 
May 13, 1919. 

It provides for leases for any term deemed advisable by the 
Secretary and the rules fix such term at ten years. 

In the Osage circulars of May 13, 1919, a schedule of excessive 
fines is adopted which increases departmental supervision to its 
utmost extreme. 

216 



INDIANS 217 

Tribal Lands. 

The Act of February 28, 1891 (26 Stat. L. 795) provides for 
ten year leases on tribal lands, and under it regulations were 
issued July 12, 1909, reprinted June 28, 1916. 
. The Act of March 3, 1909 (35 Stat. L. 781, 783) refers to land 
allotted to Indians in severalty (excepting the five civilized tribes 
and the Osages), under which a regulation circular was issued 
September 3, 1912. 

The various regulations issued under the above Acts provide 
for all the usual contingencies of oil and gas operations, and 
forms of leases are printed with them. The general purport of 
these regulations and the leases is to give absolute power to the 
department to cancel the lease for any violation of its provisions 
and they reserve the right of superintendence of the lease. 

Moore v. Sawyer, 167 Fed. 826 construes the Act of June 1902 
(32 Stats. 500) and the Act of April 21, 1904, (33 Stats. 204) 
as to restrictions on leases by allottees of Indians of the Five 
Civilized Tribes. 

Under Act of April 26, 1906 and May 27, 1908, the exclusive 
control of the mineral rents from restricted lands of full blood 
tribal Indians of the five tribes is vested in the Secretary of the 
Interior, and they cannot be conveyed by the allotee. United 
States v. Hinkle, 261 Fed. 518; Hoyt v. Fixico (Okla.) 175 Pac. 
517. But the approval of an oil and gas lease by the Secretary 
of the Interior removes the restrictions. Parker v. Riley, 243 
Fed. 42, 155 C. C. A. 572. And such approval relates back to 
the date of the lease. Scioto Oil Co. v. O'Hern (Okla.) 169 Pae. 
483. 

The decisions generally uphold the action of the Secretary ot 
the Interior unless his rulings are clearly arbitrary. Anicker v. 
Gwisbera, 246 U. S. 110, 62 L. ed. 603, 38 Sup. Ct. 228; United 
States v. Lane, 258 Fed. 520. 

In United States v. Moore, 261 Fed. 523 it was held that the 
United States could not recover payments already made, altho 
the {issignmcnt under which they \?ere made might have been 
ne\ aside. 

A contract in violation of the restrictions not approved by the 
Secretary of the Interior, will not be enforced. The restrictions 



-i: MOKKliSO-N'lS OIL RIGHTS 

are a matter of government policy and no rule of property will 
avail to defeat them. Wah-Hrah-lum-Pah v. To-wah-e-He, 188 
Pac. 106 (Okla.). 

Congress has exclusive power to control the alienation of land 
allotted to or inherited by the five civilized tribes of Indians. 
Canfield v. Jack, 188 Pac. 1040 (Okla.). 

The substance of the above line of decisions is that the Indian 
is considered as a ward of the government which exercises its 
guardianship through the Interior Department and that the 
Acts of Congress and the regulations under them will be liber- 
ally construed in favor of a supposedly helpless and dependent 
party. There should be no complaint against this policy. The 
ward should be protected by every construction in its favor but 
concession to that effect does not imply concession to regulations 
which impose burdens in the shape of fines and supervision 
against and over the oil lessees with no corresponding benefit to 
the Indian intended to be protected. 

The foreclosure of a mortgage on an Indian oil lease is no 
invasion of the powers of the Secretary of the Interior for the 
protection of the Indians. McKee v. Interstate Oil t& Gas Co. 
188 Pac. 109 (Okla.). 

The Form of Lease 

providing minutely for details of work, superintendence, notices, 
installments of royalty and almost impracticable conditions as 
to separation of oil and gas if both are found, is printed with 
the regulations. 

To comply literally with its terms is a physical impossibility 
but the lease provides that any failure to comply with any of its 
provisions or with the regulations or noncompliance with the 
orders of the superintendent subjects the lease to forfeiture or 
to fine "31 ot exceeding $500 per day for each and every day" 
of the default. 

Such a lease does not come within the definition of a contract — 
an agreement between twQ persons — and is merely the permis- 
sion of the department to the lessee to work at its pleasure. None 
would deny that the Indians ought to be protected, nor object to 
drastic regulations, nor is it assumed that the department would 



INDIANS 219 

arbitrarily exercise its authority, but if literally construed and 
enforced the lessee is practically beyond the protection of the 
law. 

It is the duty of the United States to protect the Indians' 
leased oil lands and a bill charging conspiracy to defraud them, 
was sustained in United States v. Apple, 262 Fed. 200. 



CHAPTER 57. 

COAL LAND. 

The settled policy of the government has long been to consider 
mineral lands including coal under special legislation. United 
States v. Sweet, 245 U. S. 563, 62 L. ed. 473, 38 Sup. Ct. 193. 
The original coal Act was passed in 1873 allowing entries of 
from 160 to 640 acres upon proof of improvements. (R, S. Sees. 
2347-2352) at a minimum price of $10 and $20 per acre accord- 
ing to the distance from railroad. It is printed and the decisions 
under it cited in Mining Rights, 15th ed. p. 655. 

Then came the Acts of 1909 and 1910 (33 Stat, L. 844, 3o 
Stat, L. 583) allowing agricultural claims to be entered reserv- 
ing the coal to the United States: and the Nevada Homestead 
Act of Oct. 22, 1919, St. L. allowing separate entries of surface 
and coal. They are now covered by the oil leasing Act of 1920. 

Appraisal of Price. 

We mention this original Act with reference to a construction 
placed by the department on the words "not less than" preced- 
ing the $10 and $20 prices. 

For many years coal lands were legitimately and as a matter 
of course entered at these prices but later the land office, stress- 
ing the words "not less than," arbitrarily held that the price of 
coal lands should be fixed at any valuation the department chose 
to put upon them. Not only could they appraise the land at a 
higher price but could reappraise and enlarge the price. On an 
application by Charles S. Thomas, 47 L. D. 43, the price was 
raised from $20 to $150 per acre. 

This construction at once destroyed all inducement to prospect 
for coal and changed the ancient policy of the government which 
had been to deal equally with all citizens to one of departmental 

220 



COAL LAND 221 

favor allowing speculators to take the benefit of the prospectors 
discovery. 

Knowledge of Coal Value. 

In a suit to set aside an agricultural patent because issued on 
coal land, it was held that the mere possibility of underlying 
coal was not enough to make good such contention. United 
States v. Porter Fuel Co., 247 Fed. 769. For other cases of 
attack on patents on the same ground, see Mining Rights, 15th 
ed. p. 657. 

One who contests and defeats the claim of the State to land 
on account of its coal value gains no right to make entry of the 
same. Utah v. Olson, 47 L. D. 58. 

There is a distinction between the mere discovery of coal and 
the "development" on the mine required by the Alaska coal land 
Act of April 28, 1904. United States v. Lane (U. S.) 40 Sup. 
Ct. Rep. 33. 



CHAPTER 58. 

OIL SHALE. 

Oil shale was clearly taken up as a placer claim before the 
leasing Act of 1920, and for future locations is covered by that 
act. 

We find no cases on oil shale locations but shale grease and 
oil shales are mentioned incidentally as insufficient proof of dis- 
covery in oil well litigation. Dean v. Omaha-Wyoming Oil Co., 
21 Wyo. 133, 128 Pac. 881, 129 Pac. 1023 ; Southwestern Oil Co. 
v. Atlantic Co., 39 L. D. 335. 

The shale in these cases had no workable value and was only 
referred to, in attempt to save the point of discovery. 

There are immense deposits of this valuable mineral in Colo- 
rado, Wyoming, Utah and Nevada, and it is looked to for vast 
supply of oil and its innumerable by-products in future years 
when the supply of fluid oil may have become practically ex- 
hausted. 

To Be Located as Placers. 

In United States v. Ohio Oil Co., 240 Fed. 996, Riner, J., says : 
the term placer claim "means ground that includes valuable de- 
posits not in place, while by the term, veins or lodes, as used in 
the statute are meant lines or aggregations of mineral imbedded 
in quartz or other rock in place." 

A shale deposit is in place and it is imbedded in rock. To 
that extent it comes within the above definition. But its mineral 
value is nonmetallie, and of a class which has been generally 
located as placer. In Webb v. American Asphalthum Co., 157 
Fed. 203, 84 C. C. A. 651. Asphalt which is nonmetallie, be- 
cause found in the shape of a longitudinal injection, was held 
locatable as a lode. Many other nonmetallie minerals, such as 
marble, sulphur, slate, kaolin have gone to patent as placers 

222 



OIL SHALE 223 

with the approval of the land department. An oil shale claim 
meets the description of a blanket lode claim, but its mineral is 
of a class which lias almost uniformly been patented as a placer. 
See Mining Rights, 15th ed. 259. 

But these distinctions are of little value, because it seems to 
be clear under the language of the Oil Placer Act, that they 
should be located as placers. The Act of 1897 says, "That any 
person may enter and obtain patent to land, containing petro- 
leum or other mineral oils and chiefly valuable therefor." 29 
Stat. L. 526. The wording of the Act concerning annual labor 
on oils placers bears out this construction. Comp. L. 1911 p. 
611, 32 Stat. L. 825. 

It is true that oil shale claims as such, were not generally 
known when these Acts were passed but their language is as 
applicable to oil bearing rock as it is to liquid oil and the almost 
universal practice has been in accordance with this construction 
to locate and record them as placers. 

For a recent ruling that oil shale claims could be located as 
placers, and may be patented as such, see Chapter 65, Analysis 
of Sec. 21. 



CHAPTER 59. 

LOCATION OF OIL PLACER CLAIMS. 

Congressional Legislation. 

Oil claims began to be located on the public domain as soon 
as the Act of Congress of 1870 was passed which declared 
placers open to discovery, location and patent, and have ever 
since been entered and patented the same as any other placer 
claim. 

There was no special legislation concerning them until there 
came in 1896 a sporadic decision by the Land Office holding 
that oil was not a mineral and therefore oil claims were not 
locatable. Union Oil Co., 23 L. D. 222. This decision was 
shortly after overruled by the Secretary of the Interior (25 L. 
D. 351) but to remove all controversy the Act of 1897 was passed 
which declared in terms that oil territory could be taken up and 
patented as placers. 

Further legislation special to oil claims was the Act of 1911 
which allowed the annual labor to be done on one of a group of 
not exceeding five claims. Consolidated Mut. Oil Co. v. United 
States, 245 Fed. 521, 157 C. C. A. 633. 

Up to the passage of the Oil Leasing Act of 1920 there was 
nothing to differentiate oil land from other placer land barring 
the annual labor Act just mentioned and the withdrawal orders 
and Acts, which began in 1909. 

These withdrawal orders and Acts, while not always mention- 
ing oil in terms, were intended to affect oil territory especially 
and were the result of a new policy of the government growing 
out of the fact that the use of oil for power and locomotion, had 
produced such a vast and unprecedented demand for it that there 
was danger that the world's supply would be shortly exhausted 
and that therefore the government should interfere to conserve 
the oil for the ultimate future. 

224 



LOCATION OF OIL PLACER CLAIMS 'l'Z~> 

And behind all this was that human covetousness which sug- 
gested that the government should become a partner with the 
prospector and take a share of his profits. 

These two inducing causes brought about the Oil Act of 1920 
which is intended to cover all future acquisitions of Oil Rights. 

Premising, of course, that where oil or gas is discovered on 
lands patented as mineral or in any other form, the patents con- 
taining no special reservation and none being implied, it belongs 
to the owner of the fee simple title; we propose to consider the 
rights in oil and gas on the public domain under Legislation 
prior to the Oil Leasing Act and later, such rights as controlled 
by the provisions of that Act approved and in force from Febru- 
ary 25, 1920. 

Federal Requirements. 

The location of the claim is governed by the terms of Sees. 
2320 and 2324 of the U. S. R, S. that for all sorts of claims, 
lode or placer, there must be a discovery and that the location 
must be distinctly marked on the ground so that its boundaries 
can be readily traced. These are the only two federal require- 
ments. 

State Requirements. 

All other details are left to state or district regulation. Dis- 
trict rules had practically gone into oblivion before oil placers 
began to be taken up. But practically every Western Mining 
State has more or less minute regulations as to details of loca- 
tion which must be followed. Discarding specific points (which 
will be found in the local statutes for each of the mining states 
printed in chap. 87) their general requirements are, a location 
notice, staking and the location certificate. In general terms 
oil placers are staked and recorded the same as other' placers. 
Wolfskin v. Smith, 5 Cal. App. 175, 89 Pac. 1001. 

Incidents Peculiar to Oil Discovery. 

A discovery is required on any form of mineral claim but the 
discovery in the case of oil on account of its deep subterranean 
M. o. R.— 15. 



226 MORRISON'S OIL RIGHTS 

deposition is a fact seldom possible to show until after heavy 
expenditure and the drilling to hundreds or thousands of feet. 

All other minerals show on the surface, at least to the ex- 
tent of disclosing the gangue or mineral bearing rock or float 
from the same. 

Or if not disclosed on the surface, the removal of few feet 
of debris or overburden will disclose the apex of a lode or the 
outcrop of a mineral bed while in the very nature of things the 
oil must be sought at great depths. If it ever appeared at the 
surface it would have disappeared in the air or in the ocean 
in the long geological ages which have elapsed since it first came 
into physical existence as a fluid mineral, evolved at unknown 
depths from sources also unknown except as testified to by ex- 
perts whose knowledge is predicated on uncertain facts and their 
inferences rarely satisfactory, to those who invest on their asser- 
tions. 

As is everywhere conceded, the existence of oil cannot as a 
rule be more than guessed at from surface indications. Surface 
indications in the case of lodes consist usually of float, metallic 
stains and other incidents visible to the naked eye. But in the 
case of oil the whole geology and topography of the country must 
be studied by competent persons having knowledge of like forma- 
tions in distant and distinct localities and even then no honest 
expert can guaranty success. Some one must risk the money for 
the expense of drilling with the possibility that every dollar 
spent will be an absolute loss. 

If, however, the prognostications are borne out by finding an 
actual flow of oil the investor receives his reward and value is 
given to all adjoining tracts for considerable distances on the 
assumption that such adjoining tracts cover the same deposit. 

It is matter of common knowledge that oil is not to be found 
without drilling a well. Consolidated flfut. Oil Co. v. United 
States, 245 Fed. 525, 157 C. C. A. 633. 

The fact that oil and gas unlike the metal minerals do not 
disclose themselves at or near the surface, was not recognized in 
any of the congressional legislation, before the Leasing Act of 
1920. 

In New Mexico there is a statute allowing oil and gas claimants 



LOCATION" OF OIL PLACER CLAIMS 22 1 

to the end of the calendar year to make their discovery and 
Washington exempts them from the discovery work required on 
other placers but if literal discovery is required by the Con- 
gressional Act it is doubtful whether any State Statute could 
directly or indirectly dispense with it. 

That this distinction should have been required from the out- 
start is self-evident but we have to take the Statutes as we find 
them. 

The tapping of oil or gas by the drill in commercial quantity 
is of course a legal discovery beyond question but the tapping of 
oil or gas in noncommercial quantity has led to divergent deci- 
sions. 

Decisions on Oil Discoveries. 

In the case of the Butte Oil Company, 40 L. D. 602, a flow of 
gas, had been tapped in a 1400 foot well. This flow of gas was 
slight and had not been utilized. We treat the tapping of gas 
the same as if it had been oil, as undoubtedly a discovery of gas 
is equivalent to the discovery of oil in like quantities and under 
like circumstances. But the Secretary treated such discovery of 
nonutilized gas as not a legal discovery. It is of interest chiefly 
because it digests all the decisions up to its date in 1912 where 
oil indications had been held insufficient discoveries. This well 
had been sunk on ground afterwards created in to the Glacier 
National Park and the effect of the decision was to confiscate the 
claim to the government. A similar small showing of gas was 
held no valid discovery in United States v. McCutchen, 238 Fed. 
575. 

Seepage. 

The Butte Company case also holds that seepage of oil on the 
surface is not an oil discovery and on this point the decisions 
seem to be uniform. It cannot be successfully maintained that 
seepage is anything more than an indication that oil may exist 
or did once exist on the claim or in the neighborhood. In fact 
such seepage is not even an inducement to bore as it seems to 
indicate, not the presence of oil of present value, but is a remi- 



228 MORRISON'S OIL RIGHTS 

niscence of oil that once existed but has become evaporated or 
otherwise dissipated. Nevada Sierra Oil Co. v. Home Oil Co., 
98 Fed. 673, 20 M. R. 283 ; Olive, etc., Co. v. Olmstead, 103 Fed. 
568; Miller v. Chrisman, 140 Cal. 440, 98 Am. St. Rep. 63, 73 
Pac. 1083; Bay v. Oklahoma So. Gas, Oil d- Mix. Co., 13 Okla. 
425, 73 Pac. 936; Dean v. Omaha -Wyoming Oil Co., 21 Wyo. 
133, 128 Pac. 881, 129 Pac. 1023; Weed v. Snook, 144 Cal. 439, 
77 Pac. 1023. 

Shale or Sand. 

The discovery of a stratum of oil shale or oil sand has been 
treated as no discovery. New England & Coalinga Oil Co. v. 
Congdon, 152 Cal. 211, 92 Pac. 180; Southwestern Oil Co. v. 
Atlantic Co., 39 L. D. 335. Shale grease is not good discovery. 
Dean v. Omaha-Wyoming Oil Co., 21 Wyo. 133, 128 Pac. 881, 
129 Pac. 1023. But these decisions Imxe no bearing on cases 
where shale of value in itself for mining purposes has been dis- 
covered. 

In United States v. Ohio Oil Co., 240 Fed. 996 oil had been 
discovered in two drill holes at 35 and 57 feet. It does not seem 
to have been pumped or used. But the sworn fact that oil was 
discovered was not overcome by the testimony of a negative 
character by detectives. The Court held that the question of dis- 
covery was one of fact and applied the same test used in many 
lode cases that it was not necessary that the metal in one case, 
the oil in the other, should be of commercial value at the out- 
start, if it was enough to encourage and justify further explora- 
tion. And the Court refused to follow the severe test in Ba>) 
v. Oklahoma Co. above cited where the land to be mineral (under 
a local Act) was required to be "chiefly valuable" for mineral. 

Discovery on Group Claims. 

A discovery of oil on one of a group of four contiguous claims, 
is of no effect to operate as a discovery on the other claims. 
United States v. Stockton Midway Co.. 240 Fed. 1006. This as 
an abstract proposition, is no doubt true; every claim must ulti- 
mately have a discovery of its own before it can be validly located 






LOCATION OK 01], PLACER CLAIMS 229 

or patented, but the point as it arises under the Pickett Act is 
not so clear, and United States v. Ohio Oil Co., 240 Fed. 996, 
does not agree with this citation. 

On Boundary Line. 

In Phillips v. Brill, 17 Wyo. 26, 95 Pac 856 a well had been 
sunk and struck oil on the boundary line between two claims. 
The Court ruled that it was a good discovery for at least one of 
the claims, to whichever one the owners chose to apply the dis- 
covery, but did not decide whether it was a good discovery on 
both claims. The reason for holding that two lodes claims can- 
not be recorded on one discovery shaft does not apply with the 
same force to an oil placer. 

Staking and Record before Discovery. 

The fact that, as a rule, oil is not discovered when the pros- 
pector first takes possession, leads to an inversion in the proces- 
sion of the incidents of location. 

Discovery on a lode claim or on a gold placer is usually the 
first step and the first inducement to other steps to wit : the no- 
tice, the staking and the recording. But almost all oil claims 
are noticed, staked and recorded before discovery. This has led 
to many controversies between claims which had notice, stakes 
and record but neither of them a discovery. 

This usage of staking before discovery is recognized as legal as 
a matter almost of necessity. United States v. Thirty-two Oil 
Co., 242 Fed. 730. The order of the incidents of discovery and 
location is not material. Dean v. Omaha-Wyoming Oil Co., 21 
Wyo. 133, 128 Pac. 881, 129 Pac. 1023. A discovery after loca- 
tion will relate back and perfect the title. Weed v. Snook, 144 
Cal. 439, 77 Pac. 1023. 

The Proof of Discovery 

will vary according to the nature of the mineral. Some min- 
eral values show themselves to the eye, in other instances only an 
assay will demonstrate the presence or absence of value. Oil dis^ 
• overies are classed by themselves, surface indications being al- 



230 MORRISON'S OIL RIGHTS 

most invariably absent, and where there is proof of mineral 
value, as a rule, it does not need to be paying value at the out- 
start. 

And there are several decisions that proof of discovery after 
the lapse of years, may be a matter of practical difficulty, if not 
impossible, so that it ought to be presumed. Ralph v. Cole, 249 
Fed. 81; Harris v. Equator Co., 8 Fed. 863, 3 McCrary 14, 12 
M. R. 178; Yogel v. Warsing, 146 Fed. 949, 77 C. C. A. 199; 
Cheeseman v. Hart, 42 Fed. 98, 16 M. R. 263; Cheeseman v. 
Shreeve, 40 Fed. 787, 17 M. R, 260. 

Proof of discovery varies with the mineral formation of the 
country : slight evidence and low assays may be enough. United 
States v. Safe Inv., etc., Co., 258 Fed. 872. 

Instances. 

The fact of sluicing and taking out some gold is proof of dis- 
covery of the value of the claim as a placer. Batt v. Stedman, 
36 Cal. App. 608, 173 Pac. 99. Oole v. Ralph (U. S.) 40 Sup. 
Ct. Rep. 321. 

In an eminent domain case against a mining claim, evidence 
was allowed of mineral discovery after suit commenced. Tyson 
Creek R. Co. v. Empire Mill Co., 31 Idaho 580, 174 Pac. 1004. 

Surface openings showing colors enough to indicate pay at 
bedrock, were held a good discovery in Lange v. Robinson, 148 
Fed. 799, 79 C. C. A. 1. 

But the discovery of a few colors of gold is not enough to sus- 
tain a mining location against a prior agricultural entry. Meyers 
v. Pratt, 255 Fed. 765. In almost every gravel deposit in the 
Mining States, wandering colors of gold may be found by pan- 
ning which indicate no substantial value. 

A placer discovery must be of some form of valuable mineral 
deposit one such being shown by colors of gold. Cote v. Ralph, 
40 Sup. Ct. Rep. 321. 

The holding by the Land Office, that a discovery must show 
such a disclosure of mineral as would justify further develop- 
ment into a paying mine, upheld. Cameron v. U. S. 40 Sup. Ct. 
Rep. 410, affirming 250 Fed. 943. 



LOCATION OF OIL PLACER CLAIMS 231 

Protection of Possession before Discovery. 

The general doctrine is that : The prospector who has no dis- 
covery is entitled to protection of his possession as against an- 
other having no better right. Consolidated Mut. Oil Co. v. 
United States, 245 Fed. 525, 157 C. C. A. 633; McKenzie v. 
Moore (Ariz.) 176 Pac. 568. 

The one in possession engaged in building derrick and prepar- 
ing to sink will be protected against a later locator who also has 
made no discovery. 

Oil was discovered by plaintiff on an 80 acre tract adjoining- 
defendants claim which had no discovery, although defendant 
was getting ready to sink; held that the first-mentioned claim 
could not use its discovery to enlarge its record and take in the 
defendant's claim. Weed v. Snook, 144 Cal. 439, 77 Pac. 1023. 
A very similar case with the same holding is Phillips v. Brill, 17 
Wyo. 26, 95 Pac. 856. 

The rights of a prospector seeking diligently to make a dis- 
covery will be protected and his possession is good against a 
forcible or clandestine entry. Cole v. Ralph, 40 Sup. Ct. Rep. 
321, 322. 

Location before Discovery 

Defendant staked his oil placer in 1906, built a cabin and ex- 
pended more than the annual labor law required, but had not 
begun to drill and of course had no discovery. Plaintiff entered 
the land as a homestead in 1907. The Court held as to annual 
labor that it was not required on a nonperfected location, that 
such expenditure counted for naught and that the defendant had 
no title as against the homestead. McLemore v. Express Oil Co., 
158 Cal. 559, 139 Am. St. Eep. 147, 112 Pac. 59. 

In New England & Coalinga Oil Co. v. Congdon, 152 Cal. 211, 
92 Pac. 180, the plaintiff had a like array of facts, neither sink- 
ing nor attempting to sink, and it was held that he had no status 
on which to claim the right of possession. 

Digging a hole for a drilling machine which did not get to the 
ground for nearly a year and watching the land to keep off 
jumpers does not amount to such possession as will be protected 



232 MORRISON'S OIL RIGHTS 

as against another who drills and discovers gas. Whiting v. 
Straup, 17 Wyo. 1, 95 Pac. 849, 129 Am. St. Rep. 1093 

Borgivardt v. McKittrick Oil Co., 164 Cal. 651, 130 Pac. 417, 
a case where plaintiffs made good their proof of discovery on a 
located quarter section — decides several points on the class of 
claims where discovery is discussed. It holds that pumping is 
not necessary to follow the finding of oil. On the other hand, 
it holds that watching the claim is not possession and trying to 
raise money is no excuse for the want of actual work and that 
only diligent prosecution of work entitles the claim to legal pro- 
tection in the absence of discovery. In this case a deep well was 
sunk and found oil, but later the well was drowned by a flow of 
artesian water. 

There may be possession without the owner being actually on 
the ground. The opinion cites many cases on what constitutes 
possession, holding it to be a question of fact, unless the facts 
are not in dispute, when it becomes a question of law, and re- 
views the incidents which amount to proof of possession. 

The rights of a party in lawful possession of a claim as against 
all except the United States are as good as if he held title in fee, 
Johnson v. Hinkel, 29 Cal. App. 78, 154 Pac. 487. 

Possession without Valid Location. 

Where there is no valid location there can be no right of 
possession under it. Nelson v. Smith, 42 Nev. 302, 176 Pac. 261, 
178 Pac. 625. This was a contest between lodes and is undoubt- 
edly correct as a general proposition as it cites and follows Belk 
v. Meagher, 104 U. S. 279, 26 L. ed. 735, 1 M. R. 510, but it is 
qualified in its application to oil placers under the above cita- 
tions. 

Location Notice. 

This notice is posted at the point of discovery or at some con- 
spicuous place on the claim and usually contains the name of 
the placer, the date of posting, the number of feet in each direc- 
tion claimed, or the number of acres with the names of the 
locators. 



LOCATION OF OIL. FL.ACER GLAIMS 233 

It has been a universal custom since the days of the first min- 
ing districts in California and is now everywhere recognized by 
statute. It is supposed in theory to follow discovery, but nx the 
case of oil claims that rarely occurs and whether before or after 
discovery is not material. 

This Location Notice, one of the incidents of location, is not 
the same as the location certificate, except that in a few States 
the location certificate, that is, the record title, is by Statute 
made a copy or duplicate of the posted notice. But the terms 
location notice and location certificate are often confused. 

Knowledge Equivalent to Notice. 

Unequivocal possession of the claim is notice of the rights of 
the locators and that they never posted notice of location is 
immaterial. United States v. Rock Oil Co., 257 Fed. 331; Butte, 

etc., Co. v. Clark-Montana Co., 249 U. S. 12, 63 L. ed. , 39 

Sup. Ct. Rep. 231. Notice altho defective is sufficient as to one 
who has actual knowledge of the prior location. Thompson v. 
Underwood (Ark.) 211 S. W. 164. See page 231. 

The citations under this head, especially The Butte Co., case 
Beein to set aside all necessity for posting notice where the hos- 
tile parties have actual knowledge of the presence of the prior 
claimants 

The Record. 

Within the time allowed by the Statute of the particular 
State which is usually from thirty to ninety days a location cer- 
tificate must be filed in the office of the county recorder. 

This paper must give a description of the claim either by 
governmental subdivisions or by metes and bounds sufficient to 
identify it so that from the information contained in the lo- 
cation certificate it can be found on the ground. Gamer v. 
Glenn, 8 Mont. 371, 2 L.R.A. 813, 20 Pac. 654; Dillon v. Bayliss, 
11 Mont. 171, 27 Pac. 725; Londondery Mining Co. v. United 
Gold Mines Co., 38 Colo. 480, 88 Pac. 455. 

It contains of course the name of the claim, its size in acres or 



234 MORRISON'S OIL RIGHTS 

by length and width and must give the date of discovery and 
the names of the locators. 

It should be signed by the locators but does not need to be 
acknowledged or verified except where so required by the law 
of the particular State. 

None of the States make any distinction between the record 
of an oil or gas claim and the record of any other kind of placer 
claim except New Mexico and Washington. The Specific re- 
quirements of each State are printed and a form is given in 
chap. 87. 

This location certificate is not the same as the location notice 
posted on the claim, except in Arizona, California, Idaho, New 
Mexico and Washington which make the recorded location certifi- 
cate to consist of a copy or duplicate of the notice posted on 
the claim. 

Failure to record location certificate does not work a forfeiture 
under the California Statute and the claim is good against any 
subsequent location. Dripps v. Allison's Mines Co. (Cal. App.; 
187 Pac. 448. 

A Misdescription 

in the location certificate designating the number of feet claimed 
in each direction from the discovery shaft, is immaterial. Court- 
ney v. Ward (Colo.) 187 Pac. 517. 

The omission of the record to tie the claim to a natural object 
or permanent monument, does not make the location certificate 
void. It is amendable and a subsequent record correcting the 
omission makes it valid. Nylnnd v. Ward (Colo.) 187 Pac. 
514, overruling Frisholm v. Fitzgerald, 25 Colo. 290, 53 Pac. 
1109. Courtney v. Ward (Colo.) 187 Pac. 517, follows the Ny- 
lund case, both holding that the amended record relates back 
to the original. 

The cases where a defective record has been followed by a 
second record are cited in Mining Rights, 15 Ed. 164. There 
is irreconcilable discrepancy among them, but the opinion in the 
last citation above printed, Nylund v. Ward, does not shake our 
position that a record with no tie at all, or otherwise nonconform- 
ing to the mandatory congressional requirements, cannot by any 



LOCATION OF OIL PLACER CLAIMS 235 

subsequent record be cured so as to cut out intervening valid 
locators. 

Legal Subdivisions. 

On surveyed land, oil claims are usually taken up as quarter- 
sections or as subdivisions of quarter-sections. And the land 
office does not require staking of any subdivision. Reins v. Mur- 
ray, 22 L. D. 409. So that a subdivision placer not staked would 
be accepted in proceedings to obtain patent, but might be held 
void by the Court in the adverse claim suit. 

Whatever subdivision is taken would of course be rectangular 
in form but where a gulch or other topographical difficulty oc- 
curs the department allows a departure from this rule. Mitchell 
v. Hutchinson, 142 Cal. 404, 76 Pac. 55; Wood Placer M. Co. 
in re, 32 L. D. 363, 401. 

The same rule as to the conformity to the system of United 
States surveys applies to both surveyed and unsurveyed ground. 
Wood Placer M. Co. in re, supra. 

The requirement of the Mining Act, that placer locations 
should conform to legal subdivisions, does not compel the locator 
to disregard older interfering claims which render such con- 
formity impracticable. Dripps v. Allisons Mines Co. (Cal. 
App.) 187 Pac. 448. - 

Staking. 

Ever since the Act of May 10, 1872, staking has been an es- 
sential part of the location. It is usually complied with by a 
substantial stake or stone monument at each corner and at any 
extra angle in the claim, but extra angles in a placer location 
are not frequent. For the details of staking, see Statutory Re- 
quirements and Mining Rights 15th ed. 50. For staking of legal 
subdivisions, see next paragraph. 

New Staking Required. 

If the located ground is a government subdivision the govern- 
ment stakes are not sufficient. They are not often found on the 
ground and even if found the government does not subdivide 



236 MOREISON^ OIL EIGHTS 

its quarter-sections. Consequently only the section and quarter- 
section corners could be found. The decisions on this point are 
now practically uniform that there must be a new staking. Sax- 
ton v. Perry, 47 Colo. 263, 107 Pac. 281. Worthen v. Sidway, 
72 Ark. 215, 79 S. W. 777. But the latest California case Kern 
Oil Co. v. Crawford, 143 Cal. 298, 3 L.K,A.(N.S.) 993, 76 Pac 
1111, holds to the contrary and overrules White v. Lee, 78 Cal. 
593, 12 Am. St. Rep. 115, 21 Pac. 363. 

Exclusions. 

Where a subdivision is claimed it need not except parcels al- 
ready patented, the land office undertaking to make the proper 
exclusions. Rialto No. 2 Claim, in re, 34 L. D. 44; Mary Bar- 
ling Placer, in re, 31 L. T). 64. These land office rulings are 
cited and approved in Green v. Gavin, 10 Cal. App. 330, 101 
Pac. 931. 

Blanket Claims. 

In Stenfield v. Espe, 171 Fed. 825, 96 C. C. A. 497, an asso-. 
ciation claim was located over a quarter-section which had been 
largely covered by several smaller locations leaving only non- 
contiguous vacant spaces between. The Court held the entire 
blanket location void. 

Association Claims. 

The language of R. S. Sec. 2331 is specific that no placer "lo- 
cation shall include more than 20 acres for each individual 
claimant." The maximum claim being 160 acres, requires of 
course 8 persons to take up a full association claim and the 
rulings have been strict that the use of names of nominal parties 
is not sufficient. United States v. Brookshire Oil Co., 242 Fed. 
718. There must be 8 persons and each person must be actually 
interested in the location. This avoids many records where the 
names of nominal parties have been used. 

It has even been held that where the parties, cotemporaneous 
with the location formed a stock company with an unequal dis- 
tribution of shares, that the location was void as to those who 



LOCATION OF OIL LLACER CLAIMS 237 

received an excess number, of shares: equivalent to holding that 
each one eighth of the shares should represent 20 acres. Nome 
Co. v. Snyder, 187 Fed. 385, 109 C. C. A. 217. But after the 
\ocation has been made on a completed association, the locators 
may distribute unequally. Rooney v. Barnette, 200 Fed. 700, 
119 C. C. A. 116. 

When names are used with agreement to reconvey without con- 
sideration the association is not a valid one. Mitchell v. Cline, 
84 Cal. 409, 24 Pac. 164. Durant v. Corbin, 94 Fed. 382, 20 
M. R. 84. And the grantees of the nominal locators hold no 
better title. United States v. Brookshire Oil Co., 242 Fed. 718. 

Any device to secure more than 20 acres to one person, or 160 
ceres to an association, is a fraud upon the government. Loca- 
tions so made are invalid. United States v. California Midway 
Oil Co., 259 Fed. 343. 

Dummies. 

Where the government is not a party to the suit it may not 
be proved that the names of dummies were used for plaintiff's 
benefit. Riverside, etc., Co. v. Hardivick, 16 N. M. 479, 120 Pac. 
323. And such evidence has been excluded where the fact was 
not pleaded. Hall v. McKinnon, 193 Fed. 572, 13 C. C. A. 440. 

An association record of 160 acres is but a single claim. Mil- 
ler v. Chrisman, 140 Cal. 440, 98 Am. St. Rep. 63, 73 Pac. 1083, 
74 Pac. 444; Consolidated Mut. Oil Co. v. United States, 245 
Fed. 521, 157 C. C. A. 633. 

A corporation is one person without regard to the number 
of its stockholders. Igo Bridge Placer, in re t 38 L. D. 281 ; Coal- 
inga Hub Oil Co., in re, 40 L. D. 401. 

Nonresidents. 

The law permits location in the names of absent citizens by 
attorney in fact. United States v. California Midway Oil Co., 
259 Fed. 343. 

Corporate Employees. 

When three persons in the employ of a corporation located 60 



238 MORRISON'S OIL RIGHTS 

acres it was held valid only to the extent of 20 acres. Gird v. 
California Co., 60 Fed. 532, 18 M. R. 45. 

Repeated Locations. 

One person may locate any number of placer locations and 
one association may make repeated locations, outside of Alaska. 
Riverside, etc., Co. v. Hardwick, 16 N. M. 479, 120 Pae. 323; 
United States v. California Midway Oil Co., 259 Fed. 343; 
United States v. Brookshire Oil Co., 242 Fed. 718. 

Excess Locations. 

The staking of ground in excess of the legal size of the claim, 
lias led to a series of decisions. Where the excess is chargeable 
to mere error in overstepping, it does not invalidate the claim r 
except as to the excess, but where the excess is gross, evidently 
intended to take up more ground than allowed, or without other 
valid excuse, the whole location is void. Leg gait v. Stewart, 5 
Mont. 107, 2 Pac. 320. 

The real point of difficulty is the status of the excess ground, 
and the right of a third party to make a location and record upon 
the same. 

A number of the decisions treat the case as one of mistake, 
which is not disputable, but they go further and hold that the 
party has a reasonable time in which to correct his mistake. In 
Zimmerman v. Funchion, 161 Fed. 859, 89 C. C. A. 53, followed 
by Waskey v. Hammer, 170 Fed. 31, 95 C. C. A. 305, the locator 
was allowed a reasonable time in which to select the acreage to 
which he was entitled and it was held that he could elect on 
which side or end he would cut out Hie excess. And the same 
as to each of the bona fide locators who were in association witli 
unauthorized parties. Cook v. Klonos, 168 Fed. 700, 94 C. C. A. 
144. 

In Adams v. Yukon M. Co., 251 Fed. 226, 163 C. C. A. 382, 
a full placer association claim had been located with excess of 
27 acres. A third party located over one side of the claim. The 
Court held that such location was null because no demand had 



LOCATION OF OIL PL ACER CLAIMS 2&9 

been made on the first locators to draw in their line and eliminate 
the excess. 

In Nelson v. Smith, 42 Nev. 302, 176 Pac. 261, 178 Pac. 625, 
where a location had been made 262 feet in excess of the 900 feel 
claimed on the east end of the lode, the Nevada Supreme Court 
held that third parties had the legal right to locate this excess, 
but affirmed judgment to the contrary on a technical point of 
practice. 

In Jones v. Wild Goose, etc., Co., 177 Fed. 95. 29 L.E,A.(N.S.) 
392, 101 C. C. A. 349, it was even held that an excess claim was 
valid to its entire extent until the locator has been advised of 
the excess and had made his selection. And that a location over- 
lapping such excess claim was void. To which decision Gilbert 
J. with good reason refused to assent. 

If these decisions stand, it becomes a question of fact as to what 
is a reasonable time to reset the stakes and correct the record. 

When the excess has been eliminated it becomes open to relo- 
cation by any competent party. Gohres v. Illinois, etc., Mining 
Co., 40 Or. 516, 67 Pac. 666. 

The department frequently exercises its power to cut down 
an excess placer location and to eliminate nonmineral ground. 
In re American 8m. Co., 39 L. D. 299. 

It would seem to us that when the excess locator is allowed 
the body of his claim, he has received indulgence enough. 
Whether his trespass was willful or inadvertent, in either case 
he has staked in ground which he had no right to claim. If he 
is allowed to say where he will draw in his lines he may prevent 
other prospectors from locating on either side or end of the 
claim and may collude with the discoverer on one side and 
wrong a discoverer on the other. 

Abandonment. Annual Labor. 

The expenditure of $100 on each claim has been required ever 
since 1874 with several special Acts dispensing with it for 1893, 
1894, 1917, 1918 and 1919 allowing for those years a certificate 
in lieu to be filed. Acts also were passed saving the claims with- 



240 MORRISON »8 OIL RIGHTS 

out labor for soldiers of the Spanish war and the war with Ger- 
many. 

Abandonment and Assessment Work. 

Abandonment may be shown without reference to the neglect 
to perform the annual labor, but most of the cases on abandon- 
ment are predicated on the fact that such neglect results in the 
legal conclusion of abandonment. Abandonment is a mixed 
question of acts and intention. Bartley v. Phillips, 165 Pa. 325, 
18 M. E, 145, 30 Atl. 842. 

Mining claims may be held by performance of labor indefinite- 
ly without going to patent. Double Eagle M. Co. v. Hubbard, 
(Cal. App.) 183 Pac. 282. 

The mental intention to abandon need not be proved. All the 
facts including cessation of work, are to be considered. The 
question of abandonment is for the jury. Munsey v. Marnett 
Oil, etc., Co. (Tex. Civ. App.) 199 S. "W. 686. 

In Lease Gases. 

Where the facts proving abandonment are clear and undis- 
puted, the Court should determine the fact of abandonment and 
direct a verdict for the lessor. McMillin v. Titus, 222 Pa. 500, 
72 Atl. 240. 

No reasonable distinction can be drawn on the issue of aban- 
donment in location cases and the like issue in the lease cases, 
cited in Chapter 26. 

The failure to file the affidavit does not impair the locator's 
rights to patent. Hazzard v. Johnson (Cal. App.) 187 Pac. 121. 

Co-owner Disputing Title, 

A cotenant cannot claim contribution on annual labor expen- 
ditures where he asserts exclusive title to the claims and has 
denied the right of the cotenant to contribute to the expenses. 
Becker Franz Co. v. Shannon Copper Co., 256 Fed. 522. And 
a party preventing performance cannot take advantage of the 
nonperformance. Ames v. Sullivan, 235 Fed. 880, 149 C. C. A. 
192. 



LOCATION OF OIL PLACER CLAIMS 241 



Group Claims. 



When the work is done on a single claim or at a distance from 
the group, it must be intended for the common benefit. Anvil 
Hxjdraulic, etc., Co. v. Code, 182 Fed. 205, 105 C. C. A. 45. 
But when the owner of several claims does work only enough to 
save a part of them, he should designate the claims he intends 
to hold, outside of the claim on which the work was done. Mc- 
Kirahan v. Gold King Mining Co., 39 S. D. 535, 165 N. W. 542. 

Test of Value. 

The true test is the actual value of improvement to the mine. 
Cost of Labor and materials is evidence of such value. McKira- 
han v. Gold King Mining Co., 39 S. D. 535, 165 N. W. 542. 

By Administrator. 

It was ruled in an estate case that the administrator could 
not claim credit for annual labor unless such expenditure was 
allowed by order of court. Delaney's Estate, in re, 41 Nev. 384, 
171 Pac. 383. 

Resumption of Work. . 

Plaintiff, the owner, began work on December 30 and 31, 1913, 
kept on early in 1914, finished the work and filed proof of labor 
for 1913. Defendant went on the claim January 1, 1914, and 
relocated, and it was ruled that the plaintiff had saved his claim. 
Plough v. Nelson, 49 Utah 35, 161 Pac. 1134. 

Oil Claims. 

The incidents which distinguish oil claims from other locations 
with reference to the assessment work, are considered in Gird v. 
California Oil Co., 60 Fed. 531, 18 M. R. 45: with the holding 
that they do not qualify the rule as to work on group claims. 

Smith v. Union Oil Co., 166 Cal. 217, 135 Pac. 966, construes 

the five claims Act and rules that working one claim will not 

hold the other four, upon which no discoveries had been made, 

and that the labor on one claim referred to in the Act, means 

M. O. E.— 16. 



242 .MORRISON'S OIL RIGHTS 

the assessment work and does not include work done before dis- 
covery. 

This decision was affirmed in Union Oil Co. v. Smith, 249 U. 
S. 337, where the distinction between discovery on oil and on 
other classes of claim is conceded but with the holding that 
while the possession without discovery will be protected against 
surreptitious intrusion, an ultimate discovery in fact is indis- 
pensible and as the syllabus stated: 

"Where two contiguous tracts are claimed by the same party 
under oil land locations without discovery of mineral, drilling 
a well on one of them, for the purpose of discovering oil, even 
though it tends to determine the oil-bearing character of the 
other also, will not avail to hold the other against an intervening 
qualified claimant who enters upon it peaceably and diligently 
prosecutes discovery work on his own account." 

Perjury. 

In Veclin v. United States, 257 Fed. 550, the defendant was 
convicted of perjury in making a false affidavit of labor. 

Amendment. Relocation. 

The right to amend the location notice and record applies to 
oil claims. Dean v. Omaha-Wyoming Co., 21 Wyo. 133, 128 Pac. 
881, 129 Pac. 1023. 

The department has held that a location of the full acreage 
allowed cannot of course be amended to increase the size of the 
claim. Garden Gulch Placer, 38 L. D. 28. But in the same case 
holds that the owner of two contiguous claims cannot amend 
them into one so as to make the ground a single claim. If the 
ciereage be not increased beyond the legal limit we can see no 
reason whatever for this ruling and it lias been done in hundred, 
of cases where small claims under district rules were relocated 
as a single claim upon proceeding to apply for patent of the 
enlarged area allowed by the Mining Act of 1872. 

Where an invalid association claim of 160 acres comes by 
deed into one owner, the claim being void because there was no 
discovery, the supposed owner cannot, after he makes a cliscov- 



LOCATION OF OIL PLACES CLAIMS 24-') 

«*y, record the entire 160 acres in his own name. In re Yard, 38 
L. D. 59. 

But such ruling would not apply where the original record 
was valid and the present owner merely wanted by a new record 
to correct his boundaries or amend the description. 

An invalid association claim can be perfected by a single 
grantee to the extent of the 20 acres which one person can right- 
fully claim. In re Bakersfield Co., 39 L. D. 460. 

Presumption against the Relocation. 

There is a presumption of discovery in favor of old locations. 
Ralph v. Cole, 249 Fed. 92, 161 C. C. A. 133. And the burden 
of proof is on the relocator. Copper State Mining Co. v. Kidder 
(Ariz.) 179 Pac. 641. Land covered by lode record with no dis- 
covery is open to location. Ralph v. Cole, 249 Fed. 92, 161 C. 
C. A. 133, Reversed on other points, Cole v. Ralph (U. S.) 40 
Sup. Ct. Rep. 321. 

The relocator is not favored — especially where he is a party 
who at one time did the assessment work for the old claim. Gold. 
Creek, etc., Mines 4- Smelter Co. v. Perry, 94 Wash. 624, 162 
Pac. 996. 

Location on Abandoned Ground. 

Where mere paper location has been made upon placer ground, 
and possession has been abandoned, the land is open to reloca- 
tion. United States v. California Midway Oil Co., 259 Fed. 343. 

Location on Restored Land. 

When a placer was located on land patented to a railroad, and 
the patent was set aside, the location made before the land was 
formally restored to the public domain was valid. Double Eagle 
M. Co. v. Hubbard (Cal. App.) 183 Pac. 282. 

Form of Location Certificate. 

Know all men by these presents, that I, Thomas Lambie, of 
the city and county of Denver, State of Colorado, a citizen of 



244 MORRISON'S OIL RIGHTS 

the United States claim by right of discovery and location the 
Lambie Placer Mining Claim containing 20 acres, situate in the 
Never Never Mining District, County of Mojave, State of 
Arizona, bounded and described as follows, to wit: 

Beginning at corner No. 1 the south west corner, a stake in 
mound of stones and running thence 660 feet due north to 
corner No. 2; thence east 1320 feet to corner No. 3 the north- 
east corner; thence south 660 feet to corner No. 4 and thence 
west 1320 feet to corner No. 1 the place of beginning. 

Each stake is set in mound of stone or earth and is at least 
4^ feet long and set 1 foot in the ground and the mounds of 
stone are at least 3 feet in diameter at the base. 

From corner No. 1 a Palo Verde tree, 6 inches in diameter, 
market B. T. bears north 45 degrees west 30 feet distant and U. 
S. locating monument bears north 23 degrees west about 1 mile 
distant and King Solomon peak bears south 20 degrees east. 
This claim adjoins the East side line of the Camouflage Placer 
Mining Claim. 

Date of discovery, October 7, 1919. 

Date of location and of posting notice on the claim October 
14, 1919. 

Date of this certificate October 15, 1919. 

Thomas Lambie. 
Witness : 
Paul M. Segal. 

The above form would be valid in the Mining States generally. 



CHAPTER 60. 

APPLICATION FOR PATENT. 

There is no distinction between an application for patent on 
an oil placer and an application on any other kind of placer. 

The procedure is given at length in the 15th edition of the 
Mining Rights and we only add the rulings since that edition 
was published and give in chapter 88 the procedure for applica- 
tion for placer on surveyed lands only. 

$500 Improvements. 

This is a requirement on every application for patent since 
the Mining Act of May 10, 1872, without change, except that 
the department in early years allowed the $500 on one claim to 
be enough to patent an entire group of any number of claims. 
This utterly unreasonable construction was later changed and 
now $500. improvements must appear on each claim save that in 
a group, if the total improvements amount to enough to satisfy 
each claim, it matters not that they are unequally distributed 
and may all be shown on one or more of the several units of the 
group. In re Aldebaran M. Co., 36 L. D. 551. 

Hoads and Trails 

constructed in good faith for the manifest purpose of mining the 
claim covered by the application, are allowed as parcel of the 
expenditures. In re Tacoma Lime Co., 43 L. D. 128. 

Dredge or Derrick. 

A dredge on a gold placer and a derrick on an oil claim have 
very close analogy. Each is necessary for the purpose of ex- 
hausting the values from the ground on which constructed and 
in each case after working out the particular claim the structure 
can be removed to another. 

245 



246 MORRISON'S OIL RIGHTS 

This question came up in the case of the Garden Gulch Bar 
Placer, 38 L. D. 28 where the department held that the cost of 
a dredge was a valid expenditure to make good the required 
$500. We can see no distinction between a dredge and a derrick. 
That such improvement may be transported to another claim 
is no more of an argument against allowing its expenditure than 
would be the argument that a house built on a homestead might 
not after the homestead was perfected, be removed to another 
homestead. 

Land Office Entry. 

This is the culmination of the application for patent and after 
the payment which precedes the issue of the receivers receipt all 
proceedings are ministerial and the applicant has" only to wait 
until the papers are reached in their order when after a greater 
or shorter delay owing to the amount of business in the depart- 
ment the patent issues and is mailed to the local surveyor gen- 
eral who notifies the applicant or his attorney. 

Attack after Entry. 

Even after entry the application may be attacked and the 
land office has the power to set it aside although no adverse 
claim may have been filed. Mineral Farm Co. v. Bar rick, 33 
Colo. 410, 80 Pac. 1055. The cause for such action may be the 
omission of material steps in the application, or for misrepre- 
sentation or concealment of facts as to mineral character, and 
the proceeding is usually by protest. The jurisdiction of the 
land office when exclusive of the jurisdiction of the Courts is 
considered in chapter 62. 



CHAPTER 61. 

PATENT. 

Equivalent to Royal Grant. 

A patent is the written or record evidence of the passing of 
the ownership of land out of the king or the government into 
the citizen donee or purchaser. Under English rule the king 
was the original source of title and in those States which were 
British Colonies some few titles go back to royal grants. But 
the bulk of the land, dating back to 1787, the year of the adop- 
tion of the constitution, was held, in the original States by those 
States severally. In the new States then unorganized and un- 
settled, it belonged to the United States. Upon the acquisitions 
from France, Spain, Mexico and Russia, what few grants had 
been made, were recognized as valid by the treaties of cession. 

Out of the original public domain much was donated by con- 
gressional grants but the bulk of the area was divested by pat- 
ents to settlers. 

Vests Title in Fee. 

When a patent issues the grantee becomes owner in severalty 
and retains no connection with the original source of title; no 
ground rents were reserved, no royalties, and no severance of 
surface and mineral ownership. This was the settled policy until 
very recent years when the government began to grant coal, re- 
serving the surface, and under the latest legislation it becomes 
a sort of partner in the oil lands, with leases, royalties and 
departmental supervision, all of which are innovations and with 
their added and unavoidable complications, it is not the province 
of this book to find fault or anticipate trouble. 

247 



243 MORRISON'S OIL RIGHTS 

Subsequent Discovery of Mineral. 

Certain general principles concerning patents are : that where 
mineral rig-hts are involved the subsequent discovery of oil or 
other underground value, is of no avail to divest the title car- 
ried by the patent and that fraud in the issue of a mineral 
land patent cannot be asserted by third parties. Ketckam v. 
Pleasant Valley Co., 257 Fed. 274. 

It is nowise different when the patent was issued upon an 
agricultural or other nonmineral claim. Unless they are specif- 
ically excepted the minerals go with the soil and they pass to 
the patentee in spite of an exception in his paper where the 
land department had no right to insert such reservation. See 
chapter 81. 

Minerals discovered on agricultural grant after sale ly the 
State belong to the purchaser. Greene v. Robinson (Tex.) 210 
S. W. 498. 

Cures Breaks in Chain of Title. 

The issue of a patent is the last link in the chain of title and 
after its issue it is no longer assailable by adverse claims. It 
cures all defects in the possessory title and all. breaks in tlu 
abstract of title, nor can it be recalled by the government which 
issued it. Moore v. Bobbins, 96 U. S. 530, 24 L. ed. 848. 

If there are breaks in the chain of title which have been over- 
looked by the land office the legal title still vests in the patentee 
and the only party to complain is the party who may assert that 
his rights have been disregarded and such party may or may not 
be able to make good an interest in the property. But in such 
case the patent being valid he must treat the patentee as a trus- 
tee for his use Burke v. Southern Pacific B, Co., 234 U. S. 670, 
58 L. ed. 1527, 34 Sup. Ct. Rep. 907. 

Trusts. 

So also if there are any trusts in the chain of title they enure 
to the further protection of the beneficiary and if the trust is re- 
pudiated the beneficiary must bring his action against the holder 



PATENT 249 

of the patented title and cannot compel a reversion to the old 
possessory title; 

Fraud. 

If fraud has been perpetrated in the procurance of the patent 
it must be one of two sorts, to wit: Fraud against a co-owner or 
a hostile owner, in which case the remedy must be sought against 
the patentee; or fraud against the government, in which latter 
case the government may 'sue to set it aside. United States v. 
Iron Silver Co., 128 U. S. 673, 32 L. ed. 571, 9 Sup. Ct. Rep. 
195. 

But the title of a hostile owner, that is: One not in privity 
with the claim which has gone to patent, must be one which 
could not have been asserted by an adverse claim which is sup- 
posed to wipe out all such demands: for instance: where such 
hostile claimant has been fraudulently prevented from filing its 
adverse or where the applicant has agreed upon good considera- 
tion to make a deed of the conflict to the party who has failed 
to adverse. Poncia v. Eagle, 28 Ida. 60, 152 Pac. 208; St. Louis 
Co. v. Montana Mini Co., 171 U. S. 650, 43 L. ed. 320, 19 Sup. 
Ct. Rep. 61, 17 M. R, 658 ; Ducie v. Ford, 138 U. S. 587, 34 L. ed. 
1091, 11 Sup. Ct. Rep. 417. 

An ex parte finding as to mineral or non mineral value is open 
to contest until Issue of Patent. Kirk v. Olson, 245 U. S. 225, 
38 Sup. Ct, Rep. 114. 

Mineral Land Segregated by Land Office. 

Petroleum is a mineral intended to be reserved under the 
Southern Pacific Railroad grants. It was the duty of the Land 
Office to segregate the mineral and the nonmineral sections. 
The department is supposed to adjudicate before the patent 
issues as to whether the land is mineral or nonmineral. Instead 
<>f that, the patent issued reserving the mineral. The Court 
held the reservation void, and further that only the government 
or parties in privity with the government could attack the pat- 
ent because Issued for mineral land. Burke v. Southern Pacific 



250 MORRISON'S OIL RIGHTS 

E. B. Co., 234 U. S. 669, 58 L. ed. 1527, 34 Sup. Ct. Rep. 907. 
See page 251. 

The case of United States v. Southern Pacific B. B. Co., was 
decided by the District Court in favor of the government. (225 
Fed. 197). This was reversed by the Circuit Court of Appeals. 
(249 PYd. 785). The main issue was whether the lands were 
known to be valuable for oil when patented. On the final review 
by the Federal Supreme Court the lands were ruled to be min- 
eral and known to be mineral, and the patents were held void. 

In another suit with the same title (260 Fed. 511) decided 
just before the federal opinion was handed down, Bledsoe, J., 
deciding- in favor of the patents, ably considers the question of 
what amounts to knowledge of value, but the final decision above 
cited, of course, governs the point as a question of fact in this 
instance. 

Receiver's Receipt. 

The receiver's receipt makes the entryman prima facie entitled 
to patent. United States v. Becord Oil Co., 242 Fed. 746, and 
a contract calling for patenting of land is complied with by 
proof of final entry. Colm v. Francis, 30 Cal. App. 742, 159 
Pac. 237. 

The Record of a Patent 

in the local office is not required, because the record at Wash- 
ington shows the issue of the paper but it is nevertheless al- 
ways advisable to record it in the proper county so as to show 
on the abstract of title. 

And in case of loss of the original, a certified copy may be ob- 
tained by request to the Commissioner of the General Land Office. 



CHAPTER 62. 

THE LAND OFFICE, 

The land department is a special tribunal with quasi judicial 
functions and the Court will not by mandamus review its judg- 
ments on the mineral or nonmineral character of land. United 
States v. Fisher, 223 U. S. 683, 56 L. ed. 610, 32 Sup. Ct. Rep. 
356. But such writ may issue where the department's duty is 
plain and merely ministerial and the situation exceptional. Lane 
v. Uoglund, 244 U. S. 174, 61 L. ed. 1066, 37 Sup. Ct. Rep. 558. 
The courts have no general supervisory power over the officers 
of the land department to control their decisions upon ques- 
tions within their jurisdiction. United States v. Hitchcock, 190, 
U. S. 316, 47 L. ed. 1074, 23 L. ed. 698. 

These cases are reviewed in United States v. Lane (U. S.) 40 
Sup. Ct. Rep. 33. The Court refused to mandamus the land of- 
fice to issue patent to coal lands in Alaska where their ruling- had 
been upon a question of fact, to wit; the sufficiency of develop- 
ment required, recognizing the distinction there is between form- 
al, that is, ministerial and discretionary action. 

Duty to Determine Mineral Character. 

In many classes of claims it becomes the duty of the land de- 
partment to determine whether the land is mineral or not and 
in any such case the action of the department is final and con- 
clusive. Thomas v. Horst, 54 Mont. 260, 169 Pac. 731 ; Cameron 
v. Bass, 19 Ariz. 246, 168 Pac. 645; Cameron v. United States, 
250 Fed. 943, 163 C. C. A. 163. When such duty rests on the 
department it cannot escape it by excepting the minerals and 
such exception is void. Burke v. Southern Pac. B. B. Co., 234 
U. S. 670, 58 L. ed. 1527, 34 Sup. Ct. Rep. 907 ; Yore v. Ephraim, 
173 Cal. 245, 159 Pac. 719. There can be no collateral attack 

251 



252 MORRISON'S OIL RIGHTS 

on such land office decisions. Ketchum Coal Co. v. Pleasant 
Valley Coal Co., 50 Utah 395, 168 Pae. 86. 

The rulings of the department on these points cioncide with 
the above cited judicial decisions. Knapp, in re, 47 L. D. 156; 
Independent Land Co. v. Lavelle, 47 L. D. 169. 

This case, in itself of trifling importance, may become a prec- 
edent of far-reaching consequences: like the instance of Barron 
v. Baltimore, 1 Peters 243, which led to the denial of the benefit 
of the bill of rights as a limitation on State legislation. 

Cannot Legislate. 

In a case arising under the war time prohibition Act, an im- 
portant ruling was made that the Interior Department could not 
add to the terms of an Act of Congress, so as to make conduct 
criminal which such law left untouched. United, States v. Stand- 
ard Brewery (U. S.) 40 Sup. Ct. Rep. 139. But under the case 
of United States v. Grimaud, 220 U. S. 506, 55 L. ed. 563, 31 
Sup. Ct. Rep. 480, an indictment will lie for violation of their 
regulations. The Court says: "It must be admitted that it is 
difficult to define the line which separates legislative power to 
make laws, from administrative authority to make regulations." 
And the decision proceeds to recognize their power to enforce 
their regulations by penal procedure when the Act prohibited 
by the regulation is in itself unlawful., altho amounting only to 
a mere trespass. 

When before the Court in 216 U. S. 614, the decision below 
was affirmed by an evenly divided Court, but on rehearing it 
was reversed in an opinion which, while it fixes the law, does 
not on every mind produce conviction. It will doubtless be cited 
to sustain a construction of the Oil Leasing Act as a surrender 
of complete control of the public domain to one department to 
a large extent outside of judicial protection. 

The Land Office has complete jurisdiction to determine the 
mineral or nonmineral character of land and to determine the 
validity of an alleged mining location on the public land. Cam- 
eron v. U. S., 40 Sup. Ct. 410, affirming 250 Fed. 94:5. 

It is the province of the Land Department to adjudicate con 
troversies on the issue of mineral vel non and the intervention 



. LAND OFFICE 253 

of a law Court is useless except to preserve the status quo of 
the property. Independent L. & C. Co. v. Lavelle, 47 L. D. 169 ; 
Thomas v. Ilorst, 54 Mont. 260, 169 Pac. 731; Lynch v. U. 8., 
138 l'Vc!. 535. 

The Land Office hold jurisdiction to decide on the mineral 
character of public lands even after the State has selected lieu 
lands and has granted an oil lease on such laud. II. 8. v. Bidgc- 
ly, 262 Fed. 675. 

The Courts will not interfere with details of administration 
committed by Congress to the discretion of the Secretary of a 
Department. Southern Pac. Ii. Co. v. Lane, 263 Fed. 637 ; De- 
catur v. Paulding, 14 Pet. 497, 515. 

The Land Office is a branch of the Interior Department, and 
is explicitly defined by Ross, C. J., in this language: "Nothing 
in our public land laws is more firmly settled than that the sale 
and disposal of the public lands has been placed by statute under 
the control of the Land Department, at the head of which is 
the Secretary of the Interior, and which includes a bureau head- 
ed by the Commissioner of the General Land Office, to whom, 
as a special tribunal with quasi judicial powers, Congress has 
confided the execution of the laws which it has enacted for the 
sale and disposal of the various kinds of public lands." Devils 
Den Oil Co. v. United States, 251 Fed. 554, 163 C. C. A. 542. 

Enlarged Jurisdiction. 

The specific jurisdiction of the Land Office is over the public 
domain and it has been generally confined to ministerial du- 
ties but under the power conferred by the Oil Leasing Act of 
1920 and many other recent Acts, its functions impinge not only 
on the legislative, but on the judicial department and it prac- 
tically becomes a Court wholly uiisafeguarcled by the legal 
education of its officers or the restraining influence of an attend- 
ant panel of jurors, and the public audience of citizens. When 
public land is sold, the duties of the Land Office cease, but where 
land is leased, it retains supervision through the life time of the 
tenancy. 



254 MORRISON'S OIL RIGHTS 

Jurisdiction when Exclusive. 

In one of the Pickett Act cases, "United States v. Record Oil 
Co., 242 Fed. 746 the government attacked the claim as void. 
Entry had already been made in the Land Office and the Court 
held that this gave jurisdiction to the Land Office, and while 
the patent application was there pending, until final action of 
the department, the entry was not open to attack in the Courts. 
And in a similar suit in Devil's Den Oil Co. v. United States, 
251 Fed. 548, 163 C. C. A. 542 (reversing 236 Fed. 973) where 
the claims were contested in the Land Office, between hostile 
claimants, the Court was held to be without jurisdiction to de- 
termine the rights of the parties as against the United States. 

But pending such litigation in the Land Office, the Federal 
Court has jurisdiction to prevent waste and destruction of prop- 
erty. Devil's Den Oil Co. v. United States, 251 Fed. 548, 163 
C. C. A. 542 ; El Dora Oil Co, v. United States, 229 Fed. 946, 
144 C. C. A. 228. 



CHAPTER 63. 

THE WITHDRAWAL ACTS. 

On September 27, 1909 the President withdrew by proclama- 
tion from, entry in any form 3,041,000 acres of public land in 
California and Wyoming'. 

in United States v. Midwest Oil Company, 236 U. S. 459, 59 
L. ed. 673, 35 Sup. Ct. Rep. 309, reversing 216 Fed. 802, the 
validity of this order was contested but upheld by a majority 
opinion on the ground that such power had been constantly 
exercised by the chief executive and was therefore legal. Judges 
Day, Vandevanter and McKenna filed a dissenting opinion. 
But the majority opinion stands and the validity of the procla- 
mation has of course been ever since recognized. 

The case is confined to upholding the right of the President 
to make the order and does not pass upon any of the instances 
where rights were claimed to have been vested and therefore not 
affected by the withdrawal. 

The order itself describes immense tracts of land out of which 
many sections and subdivisions of sections had been already 
located and even patented, the order of course having no effect 
upon such parcels. 

But this proclamation of 1909 was followed by an Act of Con- 
gress of June 25, 1910, known as the Pickett Act authorizing in 
terms such withdrawals. It provided that the lands were to 
remain open to prospect for minerals other than coal, oil, gas 
and phosphate. 

By Act of August 24, 1912 the Act was amended, the right to 
explore for mining values being restricted to metalliferous min- 
erals. 

The rights of already perfected claims having a valid loca- 
tion including discovery were protected but the rights of oil 
seekers who had not yet made a complete discovery were con- 

255 



256 MORRISON'S OIL RIGHTS 

fined to those who were "in diligent prosecution of work leading 
to discovery of oil or gas." 

The department in the Pacific Midway Oil Company case, 
44 L. D. 420 (April 21, 1915) held that efforts to secure capital 
or a purchaser to take over the property did not bring the claim- 
ants within the saving clause. 

And in a later decision, June 19. 1920, by the Secretary, The 
Honolulu Consolidated Oil Co. was refused patents because no 
discoveries were made prior to the withdrawal of the lands un- 
der the Pickett Act, and the attempted compliance under the 
saving clause was held insufficient, altho roads had been con- 
structed on and lumber had been hauled to some of the claims. 
The claim to patent was based upon prosecution of group work 
and a discovery made on an adjoining patented section belong- 
ing to grantor of claimant. 

The facts in the McCiitchen case (United States v. McCut- 
chen) as reported in 234 Fed. 702, were that the lands had been 
withdrawn prior to any actual discovery of oil. After such 
withdrawal oil in quantity was tapped, but the Court construed 
the withdrawal acts with much strictness holding that the de- 
fendants although their previous expenditures had been great 
were not at the time of the withdrawal in diligent prosecution 
of work 'leading to a discovery of oil" and that the government 
was entitled to an injunction and a receiver. 

The same case coming again before the Court (238 Fed. 575) 
the decree was signed against the defendants after holding that 
the facts did not justify a finding that defendants had made any 
discovery within the proper time. 

The Court after reciting the expenditure made by the oil 
seekers and the vast value given by such expenditure to the 
land theretofore almost worthless, premises the decree in this 
language: "In so far as equitable considerations, proceeding 
from the conscience of the chancellor, and operating upon the 
conscience of the parties, have to do with this case, the Court 
purposes to do only that which is equity, and which is in line 
with the Court's most profound conceptions of high moral deal- 
ings." 






WITHDRAWAL ACTS 257 

Then follows the reference of the case to the master to ascer- 
tain the damages caused to the government. 

In the same opinion the Court gives conclusive reasons why 
the marketing companies should not be held as trespassers. 

The Court held that exemplary damage would not be allowed 
and that the defendants were not wilful trespassers deciding 
all abstract questions in favor of the defendants and on all the 
substantial points in the case holding against them. 

After the Midwest decision above cited the Midway case came 
before the District Court of Southern" California in United 
States v. Mi'dway, etc., Co., 232 Fed. 619 (May 1, 1916) where 
the Court held that none of the several defendant companies 
had any title to the land because they were not actually engaged 
in the diligent prosecution of work and passing to the measure 
of damage allowed that the cost of production should be deducted 
from the gross value of the oil and the defendant allowed the 
value of useful improvements made and that their machinery 
would not be confiscated. That except to this extent they were 
wilful trespassers. 

The Court dismissed the suit as to the marketing companies 
who had bought the oil. 

In United States v. Grass Creek Oil Co., 236 Fed. 481, 149 
C. C. A. 533, the defendants had located their claims, done pre- 
liminary prospecting and at the date of the withdrawal order 
were making preparations to drill and holding possession of the 
land through a caretaker ; the Court held that these facts brought 
them within the proviso saving the rights of bona fide occupants 
in diligent prosecution of work leading to discovery of oil or 
gas. 

In United States v. North American Oil Company, 242 Fed. 
723, the claim of the defendant was covered by the withdrawal 
order of September 27th 1909. Its grantor had made no dis- 
covery but had made large expenditures and had not commenced 
drilling merely because it was unable to procure the water 
necessary for sinking and the Court held that the title of the 
defendant was valid. 

The Court fairly considers the status of the case where oil 
M. 0. R.— 17. 



258 MORRISON'S OIL RIGHTS 

lies at the depth of several thousand feet requiring months of 
time and elaborate and expensive machinery to reach it. 

It further held that where at the date of withdrawal the 
claimant was engaged in the work of discovery and there was no 
subsequent abandonment that no more than ordinary diligence 
was required. 

United States v. Thirty-hvo Oil Company, 242 Fed. 730, was a 
somewhat similar case. The Court held that whether the- occu- 
pant was engaged in the diligent prosecution of the work was a 
question of fact dependent upon the circumstances of each par- 
ticular case; that work outside the claim such as road building 
might count but that a party who was waiting to learn the re- 
sults of drilling on adjacent claims was not protected. 

In United States v. Record Oil Co., 242 Fed. 746,. the Court 
considered the status of claims which had been entered in the 
Land Office holding that the government could not maintain its 
bill to attack the validity of defendant's claims under the Pickett 
Act, but that the procedure must be by attack in the Land Office 
which by the application had acquired jurisdiction. 

The Court also held that the Pickett Act was a congressional 
modification of the proclamation restoring bona fide occupants 
to the position of parties allowed to perfect their title. 

In Consolidated Mutual Oil Co. v. United States, 245 Fed. 521, 
157 C. C. A. 633, defendant was in possession of four claims on 
one of which it was diligently sinking at the time of the proc- 
lamation. This sinking later resulted in the discovery of oil. 
The Court held that not only the claim on which oil was struck 
but the whole group was protected. 

In this case the Court review much of the Pickett Act litiga- 
tion. They say that where an actual discovery had been made 
whereby an equitable estate had become vested in the claimant, 
such claimant did not need the protection of the proviso of the 
Act. That such proviso was intended for the benefit of the 
claims which had no discovery but had equities deserving pro- 
tection and was to be liberally construed in their favor. In 
United States v. Rock Oil Co., 257 Fed. 331, the defendants 
were shown to have been in possession on the date of the with- 
drawal order, kept diligently at work and shortly afterwards 



WITHDRAWAL ACTS 259 

found oil. But there were alleged defects in tlieir location 
papers. The Court held that such defects, or even the attempt 
of their grantors to secure more land than they were entitled 
to, did not affect their rights as parties within the protection 
elause of the Pickett Act. The opinion further holds, the same 
as Cons. Mutual Oil Co. v. United States, 245 Fed. 521, 157 
C. C. A. 633, that the Act is to be liberally construed in favor 
of the oil seekers. 

In United States v. Honolulu Co., 249 Fed. 167, the Court 
doubted whether oil boring on one of a group was the bona fide 
occupancy of the other claims, enjoined further drilling and 
appointed a receiver — with limitations on his powers for the pro- 
tection of the defendant. 

In United States v. Stockton Midway Oil Co., 240 Fed. 1006, 
the defendant owned the four quarters of section 14 located as 
four oil placers. At the time of the passage of the Pickett Act no 
discovery of oil had been made but the defendant was in dili- 
gent prosecution of work on the southwest quarter under a con 
tract calling for wells on the other three quarters after oil was 
struck on the first started well on the southwest quarter. 

The Court held that the group act had no bearing on the ease 
and that work or discovery on any one quarter section was not 
work or discovery such as to save the other three quarters from 
forfeiture under the Pickett Act. 

The Court further held that under the Act "rules are to be 
applied with strictness in favor of the government", but that 
parties holding possession without discovery are to be protected 
against all later comers having no better right altho not as 
against the government. 

The validity of the withdrawal Acts cannot be contested in an 
action between contracting parties not involving the question of 
such validity. Johnson v. Hinkel, 29 Cal. App. 78, 154 Pae. 
487. 

The cases above cited, since these decisions were made, have re- 
mained practically in statu quo and are now provided for to a 
certain extent under the Oil Leasing Act of 1920 which is con- 
sidered later. 



CHAPTER 64. 

THE OIL LEASING ACT. 

INTRODUCTORY. 

The idea of governmental x^rerogative in mines and minerals, 
is both ancient and wide spread. Under the Roman Empire the 
sovereign owned the mines of gold, silver and precious stones 
absolutely. The baser metals were allowed to the citizen sub- 
ject to a royalty. On this canon of the civil law the mining 
codes of most of the European States, and of the Spanish prov- 
inces until their liberation were based. English law reserved 
to the crown the royal metals, but claimed no rights in the baser 
minerals. This is ruled with much mediaeval learning in that 
curious decision in the reign of Queen Elizabeth (Plowden p. 
310) known as the Great Case of Mines. 

The silver mines of Laurium in Greece were worked by slaves 
for the benefit of the citizens of Athens, and because their divi- 
dends gave to each citizen a practical support, so that he could 
live without labor, Athens, while this easy unearned revenue 
lasted, was able to show a longer list of philosophers and other- 
wise eminent men than any city of its size in the world. 

That King Solomon exploited the gold of Ophir is of common 
knowledge, altho the amount he realized as stated in 1 Kings 9, 
28, reduced to modern money, was less than what more than 
one single mine has produced in recent times. 

That oil and gas were never so monopolized was only because 
they were not known. The history of the governmental claim 
to mines is found in the first chapter of Mr. Lindley's exhaus- 
tive work on mining law and in MacSwinney (p. 50) the Eng- 
lish authority on the. same subject. 

The rights of the crown were asserted by frequent reserva- 
tions in the colonial grants and, following consistent precedents, 
were demanded by the Continental Congress under the Ordi- 

260 



WITHDRAWAL ACTS 261 

nance of 1785, two years before the Federal Constitution was 
adopted — one-third of the silver, lead and copper on sale of the 
public domain was to be reserved to the government. Northern 
Vac. By. Co. v. Sodcrberg, 188 U. S. 530, 47 L. ed. 575, 23 Sup, 
Ct. 365. 

Up to 1866 there was no federal law of general application to 
the mineral values of the public land, but in sporadic Acts, lead 
and copper mines in localities were excluded from sale and sa- 
lines were constantly reserved. But no attempt was made to 
lease any minerals and so reserve a royalty revenue to the gov- 
ernment until the Act of 1807 under which leases for short pe- 
riods were allowed on lead mines. 

This Act we find considered in two cases: United States v. 
Gratiot, 14 Peters, 526, 10 L. ed. 573, and Lorimier v. Leivis, 1 
Morris (Iowa) 253, 39 Am. Dec. 462, 12 M. R. 467, holding that 
the President when authorized by Congress had the power to 
make such leases. 

The royalty derived from these leases yielded less than one- 
fourth of the expense of collecting .it. Message of President 
Polk, Dec. 2, 1845 ; Lindley on Mines, Sec. 34. 

We know of no other attempt to derive revenue by royalty 
from mines altho it was suggested in Congress after the dis- 
covery of gold in California in 1848, until the passage of the Oil 
Leasing Bill, approved February 25, 1920, under which the 
government embarks on a new policy under conditions en- 
tirely different from those which existed in 1807. But while 
more than a century elapses between the two Acts and the local 
surroundings are vastly changed the economic principles in- 
volved never alter and a partnership in business between the 
nation and its citizens is something experimental, novel, socialis- 
tic and— its results will follow without the aid of any predic 
tion on our part. 

We print the entire Act without comment but broken into 
paragraphs with headings which are no part of the Act. This 
is necessary because the bill in its passage received none of the 
trimming in committee which should have separated the sections 
into convenient divisions. 
" Then follows a brief analysis of the Act and later the para- 
graphs will be grouped under their proper heads. 



CHAPTER 65. 

FULL TEXT OP THE OIL LEASING ACT AND ANALYSIS 
OF ITS SECTIONS. 

An Act to promote the mining of coal, phosphate, oil, oil shale, 
gas, and sodium on the public domain. 1 

Be it enacted by the Senate and House of Representatives of 
ike United States of America in Congress assembled, 

Enumeration of Minerals. The Public Domain. 

That deposits of coal, phosphate, sodium, oil, oil shale, or gas, 
and lands containing such deposits owned by the United States, 
including those in national forests, 

Exclusions. 

but excluding lands acquired under the Act known as the Appa- 
lachian Forest Act, approved March 1, 1911 (Thirty-sixth Stat- 
utes, page 961), and those in national parks, and in lands with- 
drawn or reserved for military or naval uses or purposes, ex- 
cept as hereinafter provided, 

To Whom Open. 

Shall be subject to disposition in the form and manner pro- 
vided by this Act to citizens of the United States, or to any 

1LOG OF THE BILL FROM THE OFFICIAL RECORD. 
Public law No. 146. Oil and gas leasing bill. S. 2775 (Smoot). Re- 
ported in Senate August 15, 1919. Passed Senate September 3. House 
Report 398 (Oct. 21). Passed House October 30. Conferees appointed 
in Senate October 31 and in House November 1. Conference: House Re- 
port 600 (Feb. 6, 1920). Agreed to in House February 10 and in Senate 
February 11. Sent to President February 13. Approved February 25. 
1920. 

262 



OIL LEASING ACT 263 

association of suck persons, or to any corporation organized 
under the laws of the United States, or of any State or Terri- 
tory thereof, and in the case of coal, oil, oil shale, or gas, to 
municipalities : 

Helium. 

Provided, That the United States reserves the right to extract 
helium from all gas produced from lands permitted, leased, or 
otherwise granted under the provisions of this Act, under such 
rules and regulations as shall be prescribed by the Secretary of 
the Interior : Provided further, That in the extraction of helium 
from gas produced from such lands, it shall be so extracted as to 
cause no substantial delay in the delivery of gas produced from 
the well to the purchaser thereof ; 

Stock Ownership Prohibited to Certain Aliens. 

And provided further, That citizens of another country, the 
laws, customs, or regulations of which, deny similar or like privi- 
leges to citizens or corporations of this country, shall not by stock 
ownership, stock holding, or stock control, own any interest in 
any lease acquired under the provisions of this Act. 

Coal to Be Leased by Competition. Alaska Excepted. 

Sec. 2. That the Secretary of the Interior is authorized to, and 
upon the petition of any qualified applicant shall divide any 
of the coal lands or the deposits of coal, classified and unclassi- 
fied, owned by the United States, outside of the Territory of 
Alaska, into leasing tracts of forty acres each, or multiples there- 
of, and in such form as, in the opinion of the Secretary of the 
Interior, will permit the most economical mining of the coal in 
such tracts, but in no case exceeding two thousand five hundred 
and sixty acres in any one leasing tract, and thereafter the 
Secretary of the Interior shall, in his discretion, upon the request 
of any qualified applicant or on his own motion, from time to 
time, offer such lands or deposits of coal for leasing, and shall 
award leases thereon by competitive bidding or by such other 



264 x MORRISON'S OIL RIGHTS 

methods as he may by general regulations adopt, to any qualified 
applicant J 

Equitable Rights. 

Provided, That the Secretary is hereby authorized, in award- 
ing leases for coal lands heretofore improved and occupied or 
claimed in good faith, to consider and recognize equitable rights 
of such occupants or claimants : 

Coal Prospecting- Permits. 

Provided further, That where prospecting or exploratory work 
is necessary to determine the existence or workability of coal de- 
posits in any unclaimed, undeveloped area, the Secretary of the 
Interior may issue, to applicants qualified under this Act, pros- 
pecting permits for a term of two years, for not exceeding two 
thousand five hundred and sixty acres ; and if within said period 
of two years thereafter, the permittee shows to the Secretary 
that the land contains coal in commercial quantities, the per- 
mittee shall be entitled to a lease under this Act for all or part 
of the land in his permit : 

Advertisement Required. 

And provided further, That no lease of coal under this Act 
shall be approved or issued until after notice of the proposed 
lease, or offering for lease, has been given for thirty days in a 
newspaper of general circulation in the county in which the lands 
or deposits are situated: 

Leases to Railroads. , 

And provided further, That no company or corporation op- 
erating a common carrier railroad shall be given or hold a permit 
or lease under the provisions of this Act for any coal deposits 
except for its own use for railroad purposes ; and such limitations 
of use shall be expressed in all permits and leases issued to such 
companies or corporations, and no such company or corporation 
shall receive or hold more than one permit or lease for each two 



OIL LEASING ACT 265 

hundred miles of its railroad line within the State in which said 
property is situated, exclusive of spurs or switches and exclusive 
of branch lines built to connect the leased coal with the railroad, 
and also exclusive of parts of the railroad operated mainly by 
power produced otherwise than by steam: And provided fur- 
ther, That nothing herein shall preclude such a railroad of less 
than two hundred miles in length from securing and holding one 
permit or lease hereunder. 

Additional Lands to Limit of 2560 Acres. 

Sec. 3. That any person, association, or corporation holding a 
lease of coal lands or coal deposits under this Act may, with the 
approval of the Secretary of the Interior, upon a finding by him 
that it will be for the advantage of the lessee and the United 
States, secure modifications of his or its original lease by includ- 
ing additional coal lands or coal deposits contiguous to those 
embraced in such lease, but in no event shall the total area em- 
braced in such modified lease exceed in the aggregate two thou- 
sand five hundred and sixty acres. 

Coal Exhausted. 

Sec. 4. That upon satisfactory showing by any lessee to the 
Secretary of the Interior that all of the workable deposits of coal 
within a tract covered by his or its lease will be exhausted, 
worked out, or removed within three years thereafter, the Secre- 
tary of the Interior may, within his discretion, lease to such 
lessee an additional tract of land or coal deposits, which, includ- 
ing the coal area remaining in the existing lease, shall not exceed 
two thousand five hundred and sixty acres, through the same 
procedure and under the same conditions as in case of an origi- 
nal lease. 

i 

Consolidation of Leases. 

Sec. 5. That if, in the judgment of the Secretary of the In- 
terior, the public interest will be subserved thereby, lessees hold- 
ing under lease areas not exceeding the maximum permitted un- 
der this Act may consolidate their leases through the surrender 



266 MORRISON'S OIL RIGHTS 

of the original leases and the inclusion of such areas in a new 
lease of not to exceed two thousand five hundred and sixty acres 
of contiguous lands. 

Uniting Coal or Phosphate Leases on Noncontiguous Tracts. 

Sec. 6. That where coal or phosphate lands aggregating two 
thousand five hundred and sixty acres and subject to lease here- 
under do not exist as contiguous areas, the Secretary of the In- 
terior is authorized, if, in his opinion the interests of the public 
and of the lessee will be thereby subserved, to embrace in a single 
lease noncontiguous tracts which can be operated as a single 
mine or unit. 

Coal Royalty— Minimum Tonnage — Strikes — Suspension of 
Work. 

Sec. 7. That for the privilege of mining or extracting the 
coal in the lands covered by the lease the lessee shall pay to the 
United States such royalties as may be specified in the lease, 
which shall be fixed in advance of offering the same, and which 
shall not be less than 5 cents per ton of two thousand pounds, 
due and payable at the end of each third month succeeding that 
of the extraction of the coal from the mine, and an annual rental, 
payable at the date of such lease and annually thereafter, on the 
lands or coal deposits covered by such lease, at such rate as may 
be fixed by the Secretary of the Interior prior to offering the 
same, which shall not be less than 25 cents per acre for the first 
year thereafter, not less than 50 cents per acre for the second, 
third, fourth, and fifth years, respectively, and not less than $1 
per acre for each and every year thereafter during the continu- 
ance of the lease, except that such rental for any year shall be 
credited against the royalties as they accrue for that year. 
Leases shall be for indeterminate periods upon condition of dili- 
gent development and continued operation of the mine or mines, 
except when such operation shall be interrupted by strikes, the 
elements, or casualties not attributable to the lessee, and upon 
the further condition that at the end of each twenty-year period 
succeeding the date of the lease such readjustment of terms and 



OIL LEASING ACT 267 

conditions may be made as the Secretary of the Interior may de- 
termine, unless otherwise provided by law at the time of the ex- 
piration of such periods: Provided, That the Secretary of the 
Interior may, if in his judgment the public interest will be sub^ 
served thereby, in lieu of the provision herein contained requir- 
ing continuous operation of the mine or mines, provided in the 
lease for the payment of an annual advance royalty upon a 
minimum number of tons of coal, which in no case shall aggregate 
less than the amount of rentals herein provided for: Provided 
further, That the Secretary of the Interior may permit suspen- 
sion of operation under such lease for not to exceed six months 
at any one time when market conditions are such that the lease 
cannot be operated except at a loss. 

No Royalty on Coal for Private Use. 

Sec. 8. That in order to provide for the supply of strictly local 
domestic needs for fuel, the Secretary of the Interior may, under 
such rules and regulations as he may prescribe in advance, issue 
limited licenses or permits to individuals or associations of in- 
dividuals to prospect for, mine, and take for their use but not 
for sale, coal from the public lands without payment of royalty 
for the coal mined or the land occupied, on such conditions not 
inconsistent with this Act as in his opinion will safeguard the 
public interests : Provided, That this privilege shall not extend 
to any corporations: 

Coal Leases to Cities. 

Provided further, That in the case of municipal corporations 
the Secretary of the Interior may issue such limited license or 
permit, for not to exceed three hundred and twenty acres for a 
municipality of less than one hundred thousand population, and 
not to exceed one thousand two hundred and eighty acres for a 
municipality of not less than one hundred thousand and not 
more than one hundred and fifty thousand population ; and not 
to exceed two thousand five hundred and sixty acres for a mu- 
nicipality of one hundred and fifty thousand population or more, 
the land to be selected within the State wherein the municipal 



268 MORRISON'S OIL RIGHTS 

applicant may be located, upon condition that such municipal 
corporations will mine the coal therein under proper conditions 
and dispose of the same without profit to residents of such mu- 
nicipality for household use: And provided further, That the 
acquisition or holding of a lease under the preceding sections 
of this Act shall be no bar to the holding of such tract or opera- 
tion of such mine under said limited license. 

Lease of Phosphates. 

Sec. 9. That the Secretary of the Interior is hereby authorized 
to lease to any applicant qualified under this Act any lands be 
longing to the United States containing -deposits of phosphates, 
under such restrictions and upon such terms as are herein spe- 
cified, through advertisement, competitive bidding, or such other 
methods as the Secretary of the Interior may by general regula- 
tion adopt. 

Phosphate Leases Limited to 2560 Acres. 

Sec. 10. That each lease shall be for not to exceed two thou- 
sand five hundred and sixty acres of land to be described by the 
legal subdivisions of the public land surveys, if surveyed ; if un- 
surveyed, to be survej^ed by the government at the expense of 
the applicant for lease, in accordance with rules and regulations 
prescribed by the Secretary of the Interior and the lands leased 
shall be conformed to and taken in accordance with the legal 
subdivisions of such survey; deposits made to cover expense of 
surveys shall be deemed appropriated for that purpose ; and any 
excess deposits shall be repaid to the person, association, or cor- 
poration making such deposits or their legal representatives: 
Provided, That the land embraced in any one lease shall be in 
compact form, the length of which shall not exceed two and one 
half times its width. 

Phosphate Royalties. 

Sec. 11. That for the privilege of mining or extracting the 
phosphates or phosphate rock covered by the lease the lessee shall 
pay to the United States such royalties as may be specified in 



OIL LEASING ACT 269 

tlie lease, which shall be fixed by the Secretary of the Interior hi 
advance of offering the same, which shall be not less than 2 per 
centuin of the gross value of the output of phosphates or phos- 
phate rock at the mine, due and payable at the end of each third 
month succeeding that of the sale or other disposition of the phos- 
phates *or phosphate rock, and an annual rental payable at the 
date <>f such lease and annually thereafter on the area covered by 
such lease at such rate as may be fixed by the Secretary of the 
Interior prior to offering the lease, which shall be not less than 
25 cents per acre for the first year thereafter, 50 cents per acre 
for the second; third, fourth, and fifth years, respectively, and 
*1 per acre for each and every year thereafter during the con- 
riii 1 1?) nee of the lease, except that such rental for any year shall 
i" credited against the royalties as they accrue for that year. 

Term of Phosphate Lease — Readjustment. 

Leases shall be for indeterminate periods upon condition of a 
minimum annual production, except when operation shall be in- 
terrupted by strikes, the elements, or casualties not attributable 
to the lessee, and upon th,e further condition that at the end of 
each twenty-year period succeeding the date of the lease such re- 
adjustment of terms and conditions shall be made as the Secre- 
tary of the Interior shall determine unless otherwise provided by 
law at the time of the expiration of such periods : 

Suspension of work. 

Provided, That the Secretary of the Interior may permit sus- 
pension of operation under such lease for not exceeding twelve 
months at any one time when market conditions are such that 
the lease cannot be operated except at a loss. 

Surface Rights of Phosphate Lease — Millsite. 

Sec. 12. That any qualified applicant to whom the Secretary 
of the Interior may grant a lease to develop and extract phos- 
phates, or phosphate rock, under the provisions of this Act shall 
have the right to use so much of the surface of unappropriated 



270 MORRISON'S OIL RIGHTS 

and unentered lands, not exceeding forty acres, as may be deter- 
mined by the Secretary of the Interior to be necessary for the 
proper prospecting for or development, extraction, treatment, 
and removal of such mineral deposits. 

OIL & GAS. 

Prospecting Permit, 2560 Acres, Outside of Known Geological 
Structure. 

Sec. 13. That the Secretary of the Interior is hereby author- 
ized, under such necessary and proper rules and regulations as 
he may prescribe, to grant to any applicant qualified under this 
Act a prospecting permit, which shall give the exclusive right, for 
a period not exceeding two years, to prospect for oil or gas upon 
not to exceed two thousand five hundred and sixty acres of land 
wherein such deposits belong to the United States and are not 
within any known geological structure of a producing oil or gas 
field 

Drill within Six months. Sink 500 Feet and 2000 Feet. 

Upon condition that the permittee shall begin drilling opera- 
tions within six months from the date of the permit, and shall, 
within one year from and after the date of permit, drill one or 
more wells for oil or gas to a depth of not less than five hundred 
feet each, unless valuable deposits of oil or gas shall be sooner 
discovered, and shall, within two years from date of the permit, 
drill for oil or gas to an aggregate depth of not less than two 
thousand feet unless valuable deposits of oil or gas shall be 
sooner discovered. 

Two Years Extension. 

The Secretary of the Interior may, if he shall find that the 
permittee has been unable with the exercise of diligence to test 
the land in the time granted by the permit, extend any such per- 
mit for such time, not exceeding two years, and upon such con- 
ditions as he shall prescribe. 



OIL LEASING ACT 271 



Shape of Claim. 



Whether the lands sought in any such application and permit 
are surveyed or unsurvej^ed the applicant shall, prior to filing 
his application for permit, locate such lands in a reasonably com- 
pact form and according- to the legal subdivisions of the public 
land surveys if the land be surveyed ; and in an approximately 
square or rectangular tract if the land be an unsurveyed tract, 
the length of which shall not exceed two and one-half times its 
width, 

Monument and Notice. 

And if he shall cause to be erected upon the land for which a 
permit is sought a monument not less than four feet high, at 
some conspicuous place thereon, and shall post a notice in writing 
on or near said monument, stating that an application for per- 
mit will be made within thirty days after date of posting said 
notice, the name of the applicant^ the date of the notice, and such 
a general description of the land to be covered by such permit 
by reference to courses and distances from such monument and 
such other natural objects and permanent monuments as will 
reasonably identify the land, stating the amount thereof in 
acres, 

30 Days Preference Right. 

He shall during the period of thirty days following such mark- 
ing and posting, be entitled to a preference right over others to 
a permit for the land so identified. 

Staking Corners — Additional Notice. 

The applicant shall, within ninety days after receiving a per- 
mit, mark each of the corners of the tract described in the per- 
mit upon the ground with substantial monuments, so that the 
boundaries can be readily traced on the ground, and shall post in 
a conspicuous place upon the lands a notice that such permit has 
been granted and a description of the lands covered thereby : 



'2(2 MORRISON'S OIL BIGHTS 

Permits and Preference Rights in Alaska. 

Provided, That in the Territory of Alaska prospecting permits 
not more than five in number may be granted to any qualified 
applicant for periods not exceeding four years, actual drilling 
operations shall begin within two years from date of permit, 
and oil and gas wells shall be drilled to a depth of not less than 
five hundred feet, unless valuable deposits of oil or gas shall be 
sooner discovered, within three years from date of the permit 
and to an aggregate depth of not less than two thousand feet un- 
less valuable deposits of oil or gas shall be sooner discovered, 
within four years from date of permit : Provided further, That 
in said Territory the applicant shall have a preference right over 
others to a permit for land identified by temporary monuments 
and notice posted on or near the same for six months following 
such marking and posting, and upon receiving a permit he shall 
mark the corners of the tract described in the permit upon the 
ground with substantial monuments within one year after re 
eeiving such permit. # 

Lease of One Fourth to Permittee. 

Sec. 14. That upon establishing to the satisfaction of the Sec- 
retary of the Interior that valuable deposits of oil or gas have 
been discovered within the limits of the^ land embraced in any 
permit, the permittee shall be entitled to a lease for one-fourth 
of the land embraced in the prospecting permit : 

Minimum Limit 160 Acres — Surveys. 

Provided, That the permittee shall be granted a lease for as 
much as one hundred and sixty acres of said lands, if there be 
that number of acres within the permit. The area to be selected 
by the permittee, shall be in compact form and, if surveyed, to 
be described by the legal subdivisions of the public-land surveys j 
if unsurveyed, to be surveyed by the government at the expense 
of the applicant for lease in accordance with rules and regu- 
lations to be prescribed by the Secretary of the Interior and the 
lands leased shall be conformed to and taken in accordance with 
the legal subdivisions of such surveys; deposits made to cover 



OIL LEASING ACT 27 o 

expense of surveys shall be deemed appropriated for that pur- 
pose, and any excess deposits may be repaid to the person or 
persons making- such deposit or their legal representatives. 

Term Twenty Years on 5 per cent Royalty, $1 per Acre Ad- 
vance. 

Such leases shall be for a term of twenty years upon a royalty 
of 5 per centum in amount or value of the production and the 
annual payment in advance of a rental of $1 per acre, the rental 
paid for any one year to be credited against the royalties as they 
accrue for that year, with the right of renewal as prescribed in 
section 17 hereof. 

Preference Right to the Other Three Fourths. 

The permittee shall also be entitled to a preference right to 
a lease for the remainder of the land in his prospecting permit 
at a royalty of not less than 12 J per centum in amount or value 
of the production, and under such other conditions as are fixed 
for oil or gas leases in this Act, the royalty to be determined by 
competitive biding or fixed by such other method as the Secretary 
may by regulations prescribe; Provided, That the Secretary 
shall have the right to reject any or all bids. 

Twenty per cent Royalty until Lease Is Applied For. 

Sec. 15. That until the permittee shall apply for lease to the 
one quarter of the permit area heretofore provided for he shall 
pay to the United States 20 per centum of the gross value of ail 
oil or gas secured by him from the lands embraced within his 
permit and sold or otherwise disposed of or held by him for sale 
or other disposition. 

Two Hundred Feet Protection Limit — Prevention of Waste. 

Sec. 16. That all permits and leases of lands containing oil or 
gas, made or issued under the provisions of this Act, shall be 
subject to the condition that no wells shall be drilled within two 
hundred feet of any of the outer boundaries of the lands so 

Iff. 0. R.— ]8.-" 



274 MORRISON'S OIL RIGHTS 

permitted or leased, unless the adjoining lands have been 
patented or the title thereto otherwise vested in private owners, 
and to the further condition that the permittee or lessee will, in 
conducting his explorations and mining operations, use all rea- 
sonable precautions to prevent waste of oil or gas developed in 
the land, or the entrance of water through wells drilled by him 
to the oil sands or oil-bearing strata, to the destruction or in- 
jury of the oil deposits. 

Forfeiture Enforced by Court. 

Violations of the provisions of this section shall constitute 
grounds for the forfeiture of the permit or lease, to be enforced 
through appropriate proceedings in Courts of competent juris- 
diction. 

Land Within the Geologic Structure to Go to Highest Bidder. 

Sec. 17. That all unappropriated deposits of oil or gas situated 
within the known geologic structure of a producing oil or gas 
field and the unentered lands containing the same, not subject 
to preferential lease, may be leased by the Secretary of the In- 
terior to the highest responsible bidder by competitive bid- 
ding under general regulations to qualified applicants in areas 
not exceeding six hundred and forty acres and in tracts which 
shall not exceed in length two and one-half times their width, 

Bonus — Minimum Royalty 12J per cent. Advance Rental. 

Such leases to be conditioned upon the payment by the lessee 
of such bonus as may be accepted and of such royalty as may be 
fixed in the lease, which shall not be less than 12J per centum 
in amount or value of the production, and the payment in ad- 
vance of a rental of not less than $1 per acre per annum there- 
after during the continuance of the lease, the rental paid for any 
one year to be credited against the royalties as they accrue for 
that year. 



OIL LEASING ACT 275 

Term Twenty Years. Renewals. 

Leases shall be for a period of twenty years, with the pref- 
erential right in the lessee to renew the same for successive peri- 
ods of ten years upon such reasonable terms and conditions as 
may be prescribed by the Secretary of the Interior, unless other- 
wise provided by law at the time of the expiration of such peri- 
ods. 

Reduction of Royalty, 

Whenever the average daily production of any oil well shall 
not exceed ten barrels per day, the Secretary of the Interior is 
authorized to reduce the royalty on future production when in 
his judgment the wells cannot be successfully operated upon 
the royalty fixed in the lease. The provisions of this paragraph 
shall apply to all oil and gas leases made under this Act. 

Leases on Land Withdrawn under the Proclamation. 

Sec. 18. That upon relinquishment to the United States, filed 
in the General Land Office within six months after the approval 
of this Act, of all right, title, and interest claimed and possessed 
prior to July 3, 1910, and continuously since by the claimant or 
his predecessor in interest under the pre-existing placer mining 
law to any oil or gas bearing land upon which there has been 
drilled one or more oil or gas wells to discovery embraced in the 
executive order of withdrawal issued September 27, 1909, and 
not within any naval petroleum reserve, 

Royalty on Such Lease. 

And upon payment as royalty to the United States of an 
amount equal to the value at the time of production of one-eighth 
of all the oil or gas already produced except oil or gas used for 
production purposes on the claim, or unavoidably lost, from such 
land, the claimant, or his successor, if in possession of such land, 
undisputed by any other claimant prior to July 1, 1919, shall 
be entitled to a lease thereon from the United States for a period 
of twenty years, at a royalty of not less than 12^ per centum 



276 MORRISON'S OIL RIGHTS 

of all the oil or gas produced except oil or gas used for produc 
tion purposes on the claim, or unavoidably lost ; 

Limit of Area of Such Lease. 

Provided, That not more than one-half of the area, but in no 
case to exceed three thousand two hundred acres, within the ge- 
ologic oil or gas structure of a producing oil or gas field shall 
be leased to any one 'claimant under the provision of this section 
when the area of such geologic oil structure exceeds six hundred 
and forty acres. Any claimant or his successor, subject to this 
limitation, shall, however, have the right to select and receive the 
lease as in this section provided for that portion of his claim or 
claims equal to, but not in excess of, said one-half of the area of 
such geologic oil structure, but not more than three thousand two 
hundred acres. 

Secretary to Fix Royalty on Such Lease. 

All such leases shall be made and the amount of royalty to be 
paid for oil and gas produced, except oil or gas used for produc- 
tion purposes on the claim, or unavoidably lost, after the execu- 
tion of such lease shall be fixed by the Secretary of the Interior 
under appropriate rules and regulations: 

Lease on Naval Reserve. Protection Limit 660 Feet. 

Provided, however, That as to all like claims situate within any 
naval petroleum reserve the producing wells thereon only shall 
be leased, together with an area of land sufficient for the opera-- 
tion thereof, upon the terms and payment of royalties for past 
and future production as herein provided for in the leasing of 
claims. No wells shall be drilled in the land subject to this provi- 
sion within six hundred and sixty feet of any such leased well 
without the consent of the lessee: 

Idem. Preference Right. 

Provided, however, That the President may, in his discretion, 
lease the remainder or any part of any such claim upon which 



OIL LEASING ACT 277 

such wells have been drilled, and in the event of such leasing 
said claimant or his successor shall have a preference right to 
such lease: 

Drilling within the Protection Limit. 

And provided further, That he may permit the drilling of 
additional wells by the claimant or his successor within the 
limited area of six hundred and sixty feet theretofore provided 
for upon such terms and conditions as he may prescribe. 

Fraud. 

No claimant for a lease who has been guilty of any fraud or 
who had knowledge or reasonable grounds to know of any 
fraud, or who has not acted honestly and in good faith, shall be 
entitled to any of the benefits of this section. 

Adjustment of Suits. 

Upon the delivery and acceptance of the lease, as in this sec- 
tion provided, all suits brought by the government affecting such 
lands may be settled and adjusted in accordance herewith and all 
moneys impounded in such suits or under the Act entitled "an 
Act to amend an Act entitled 'an Act to protect the locators in 
good faith of oil and gas lands who shall have effected an actual 
discovery of oil or gas on the public lands of the United States, 
or their successors in interest/ approved March 2, 1911," ap- 
proved August 25, 1914 (Thirty-eighth Statutes at Large, page 
708), shall be paid over to the parties entitled thereto. 

Land Claimed by Two Parties. 

In case of conflicting claimants for leases under this section, 
the Secretary of the Interior is authorized to grant leases to one 
or more of them as shall be deemed just. All leases hereunder 
shall inure to the benefit of the claimant and all persons claiming 
through or under him by lease, contract, or otherwise, as their 
interests may appear, subject, however, to the same limitation 



278 MORRISON'S OIL RIGHTS 

as to area and acreage as is provided for claimant in this sec- 
tion: 

Assigns Since Sept. 1, 1919. Exchange of Lands before Jan. 1, 
1920. 

Provided, That no claimant acquiring any interest in such 
lands since September 1, 1919, from a claimant on or since said 
date claiming or holding more than the maximum allowed claim- 
ant under this section shall secure a lease thereon or any interest 
therein, but the inhibition of this proviso shall not apply to an 
exchange of any interest in such lands made prior to the 1st day 
of January, 1920, which did not increase or reduce the area 
or acreage held or claimed in excess of said maximum by either 
party to the exchange: 

Maximum Acreage. 

Provided further, That no lease or leases under this section 
shall be granted, nor shall any interest therein, inure to any per- 
son, association, or corporation for a greater aggregate area or 
acreage than the maximum in this section provided for. 

Authority to Settle Suits. 

Sec. 18a. That whenever the validity of any gas or petroleum 
placer claim under pre-existing law to land embraced in the Ex- 
ecutive order of withdrawal issued September 27, 1909, has been 
or may hereafter be drawn in question on behalf of the United 
States in any departmental or judicial proceedings, the President 
is hereby authorized at any time within twelve months after the 
approval of this Act to direct the compromise and settlement of 
any such controversy upon such terms and conditions as may be 
agreed upon, to be carried out by an exchange or division of 
land or division of the proceeds of operation. 

Certain Claims Having No Discovery Allowed Six Months to 
Come in Under this Act. 

Sec. 19. That any person who on October 1, 1919, was a bona 



OIL LEASING ACT 279 

fide occupant or claimant of oil or gas lands under a claim in- 
itated while such lands were not withdrawn from oil or gas loca- 
tion and entry, and who had previously performed all acts under 
then existing laws necessary to valid locations thereof except to 
make discovery, and upon which discovery had not been made 
prior to the passage of this Act, and who has performed work or 
expended on or for the benefit of such locations an amount equal 
in the aggregate of $250 for each location if application therefor 
shall be made within six months from the passage of this Act 
shall be entitled to prospecting permits thereon upon the same 
terms and conditions, and limitations as to acreage, as other per- 
mits provided for in this Act, 

Claims Having* a Discovery Entitled to Lease. 

Or where any such person has heretofore made such discovery, 
he shall be entitled to a lease thereon under such terms as the 
Secretary of the Interior may prescribe unless otherwise pro- 
vided for in section 18 hereof : 

Royalty of Leases under Last Paragraph Above. 

Provided, That where such prospecting permit is granted upon 
land within any known geologic structure of a producing oil or 
gas field, the royalty to be fixed in any lease thereafter granted 
thereon or any portion thereof shall be not less than 12J per 
centum of all the oil or gas produced except oil or gas used for 
production purposes on the. claim, or unavoidably lost : 

Navy Reserves Excepted. 

Provided, however, That the provisions of this section shall 
not apply to lands reserved for the use of the navy : 

Fraud. 

Provided, however, That no claimant for a permit or lease who 
has been guilty of any fraud or who had knowledge or reasonable 
grounds to know of any fraud, or who has not acted honestly 



-J80 MORRISON'S OIL RIGHTS 

and in good faith, shall be entitled to any of the benefits of this 
section. 

Legal Representatives. 

All permits or leases hereunder shall inure to the benefit of 
the claimant and all persons claiming through or under him by 
lease, contract, or otherwise, as their interests may appear. 

Permits or Leases on Land where Surface and Mineral Have 
Been Severed — Railroad Grants Excepted. 

Sec. 20. In the case of lands bona fide entered as agricultural, 
and not withdrawn or classified as mineral at the time of entry, 
but not includiug lauds claimed under any railroad grant, the 
entryman or patentee, or assigns, where assignment was made 
prior to January 1, 1918, if the entry has been patented with the 
mineral right reserved, shall be entitled to a preference right to 
a permit and to a lease, as herein provided, in case of discovery. 

Such Severed Holdings May Combine. 

And within an area not greater than a township such entryman 
and patentees, or assigns holding restricted patents may combine 
their holdings, not to exceed two thousand Hve hundred and 
sixty acres for the purpose of making joint application. Leases 
executed under this section and embracing only lands so entered 
shall provide for the payment of a royalty of not less than 12^ 
per centum as to such areas within the permit as may not be 
included within the discovery lease to which the permittee is 
entitled under section 14 hereof. 

Oil Shale Leases — Royalty. Acreage Rent. 5120 Acres Limit. 
Readjustment. 

OIL SHALE. 

Sec. 21. That the Secretary of the Interior is hereby author- 
ized to lease to any person or corporation qualified under this 
Act any deposits of oil shale belonging to the United States and 
the surface of so much of the public lands containing such de- 



OIL LEASING ACT 281 

posits, or land adjacent thereto, as may be required for the ex- 
traction and reduction of the leased minerals, under such rules 
and regulations, not inconsistent with this Act, as he may pre- 
scribe; that no lease hereunder shall exceed five thousand one 
hundred and twenty acres of land, to be described by the legal 
subdivisions of the public-land surveys, or if unsurveyed, to be 
surveyed by the United States, at the expense of the applicant, 
in accordance with regulations to be prescribed by the Secretary 
of the Interior. Leases may be for indeterminate periods, upon 
such conditions as may be imposed by the Secretary of the Inte- 
rior, including covenants relative to methods of mining, preven- 
tion of waste, and productive development. For the privilege 
of mining, extracting, and disposing of the oil or other minerals 
covered by a lease under this section the lessee shall pay to the 
United States such royalties as shall be specified in the lease and 
an annual rental, payable at the beginning of each year, at the 
rate of 50 cents per acre per annum, for the lands included in 
the lease, the rental paid for any one year to be credited against 
the royalties accruing for that year ; such royalties to be subject 
to readjustment at the end of each twenty-year period by the 
Secretary of the Interior : 

Waiver of Rent and Royalty. 

Provided, That for the purpose of encouraging the production 
of petroleum products from shales the Secretary may, in his dis- 
cretion, waive the payment of any royalty and rental during the 
first five years of any lease : 

Oil Shale Locations May Relinquish and Come under the Act, 

Provided, That any person having a valid claim to such min- 
erals under existing laws on January 1, 1919, shall, upon the re- 
linquishment of such claim, be entitled to a lease under the pro- 
visions of this section for such area of the land relinquished as 
shall not exceed the maximum area authorized by this section to 
be leased to an individual or corporation : 



2S2 MORRISON'S OIL RIGHTS 

Fraud. 

Provided, however, That no claimant for a lease who has been 
guilty of any fraud or who had knowledge or reasonable grounds 
to know of any fraud, or who has not acted honestly and in good 
faith, shall be entitled to any of the benefits of this section: 

Only One Lease Under this Section. 

Provided further, That not more than one lease shall be 
granted under this section to any one person, association, or cor- 
poration. 

ALASKA OIL PROVISO. 

Claims without Discovery in Alaska. 

Sec. 22. That any bona fide occupant or claimant of oil or gas 
bearing lands in the Territory of Alaska, who, or whose predeces- 
sors in interest, prior to withdrawal had complied otherwise with 
the requirements of the mining laws, but had made no discovery 
of oil or gas in wells and who prior to withdrawal had made 
substantial improvements for the discovery of oil or gas on or 
for each location or had prior to the passage of this Act expended 
iiot less than $250 in improvements on or for each location shall 
be entitled, upon relinquishment or surrender to the United 
States within one year from the date of this Act, or within six 
months after final denial or withdrawal of application for pat- 
ent, to a prospecting permit or permits, lease or leases, under 
this Act covering such lands, not exceeding five permits or leases 
in number and not exceeding an aggregate of one thousand two 
hundred and eighty acres in each : 

Alaska Readjustment. Waiver of Rent and Royalty. 

Provided, That leases in Alaska under this Act whether as a 
result of prospecting permits or otherwise shall be upon such 
rental and royalties as shall be fixed by the Secretary of the In- 
terior and specified in the lease, and be subject to readjustment 
at the end of each twenty-year period of the lease; Provided 



OIL LEASING ACT 283 

further, That for the purpose of encouraging the production of 
petroleum products in Alaska the Secretary may, in his discre- 
tion, waive the payment of any rental or royalty not exceeding 
the first five years of any lease. 

Alaska. Fraud. 

No claimant for a lease who has been guilty of any fraud or 
who had knowledge or reasonable grounds to know of any fraud, 
or who has not acted honestly and in good faith, shall be entitled 
to any of the benefits of this section. 



SODIUM AND BORAX. 

Two Year Permits to Sodium and Borax Claimants. 

Sec. 23. That the Secretary of the Interior is hereby author- 
ized and directed, under such rules and regulations as he may 
prescribe, to grant to any qualified applicant a prospecting per- 
mit which shall give the exclusive right to prospect for chlorides, 
sulphates, carbonates, borates, silicates, or nitrates of sodium dis- 
solved in and soluble in water, and accumulated by concentration, 
in lands belonging to the United States for a period of not ex- 
ceeding two years: Provided, That the area to be included in 
such a permit shall be not exceeding two thousand five hundred 
and sixty acres of land in reasonably compact form : 

San Bernardino County Excepted. 

Provided further, That the provisions of this act shall not 
apply to lands in San Bernardino County, California. 

Leases to Sodium and Borax Permittees, 

Sec. 24. That upon showing to the satisfaction of the Secre- 
tary of the Interior that valuable deposits of one of the sub- 
stances enumerated in section 23 hereof has been discovered by 
the permittee within the area covered by his permit and that 
such land is chiefly valuable therefor the permittee shall be en- 
titled to a lease for one-half of the land embraced in the prospect 



284 MORRISON'S OIL RIGHTS 

ing permit, at a royalty of not less than one-eighth of the amount 
or value of the production, to be taken and described by legal 
subdivisions of the public-land surveys, or if the land be not sur- 
veyed by survey executed at the cost of the permittee in accord- 
ance with the rules and regulations to be prescribed by the 
Secretary of the Interior. The permittee shall also have the 
preference right to lease the remainder of the lands embraced 
within the limits of his permit at a royalty of not less than one- 
eighth of the amount or value of the production to be fixed by 
the Secretary of the Interior. Lands known to contain such 
valuable deposits as are enumerated in section 23 hereof and not 
covered by permits or leases, except such lands as are situated 
in said county of San Bernardino, shall be held subject to lease, 
and may be leased by the Secretary of the Interior through ad- 
vertisement, competitive bidding, or such other methods as' he 
may by general regulations adopt, and in such areas as he shall 
fix, not exceeding two thousand five hundred and sixty acres ; all 
leases to be conditioned upon the payment by the lessee of such 
royalty of not less than one-eighth of the amount or value of the 
production as may be fixed in the lease, and the payment in ad- 
vance of a rental of 50 cents per acre for the first calendar year 
or fraction thereof and $1 per acre per annum thereafter during 
the continuance of the lease, the rental paid for any one year to 
be credited on the royalty for that year. Leases may be for in- 
determinate periods, subject to readjustment at the end of each 
twenty-year period, upon such conditions not inconsistent here- 
with as may be incorporated in each lease or prescribed in gen- 
eral regulation theretofore issued by the Secretary of the Inte- 
rior, including covenants relative to mining methods, waste, 
period of preliminary . development, and minimum production, 
and a lessee under this section may be lessee of the remaining 
lands in his permit. 

40 Acre Mill Site Privileges to Sodium Claims. 

Sec. 25. That in addition to areas of such mineral land 
which may be included in any such prospecting permits or leases, 
the Secretary of the Interior, in his discretion, may grant to a 



OIL LEASING ACT 285 

permittee or lessee of lands containing sodium deposits, and sub- 
ject to the payment of an annual rental of not less than 25 cents 
per acre, the exclusive right to use, during the life of the permit 
or lease, a tract of unoccupied nonmineral public land, not ex- 
ceeding forty acres in area, for camp sites, refining works, and 
other purposes connected with and necessaiy to the proper de 
velopment and use of the deposits covered by the permit or lease. 

General provisions applicable to coal, phosphate, sodium, oil, 
oil shale, and gas leases. 

Power to Cancel Prospecting Permits. 

Sec. 26. That the Secretary of the Interior shall reserve and 
may exercise the authority to cancel any prospecting permit up- 
on failure by the permittee to exercise due diligence in the 
prosecution of the prospecting work in accordance with the terms 
and conditions stated in the permit, and shall insert in every such 
permit issued under the provisions of this Act appropriate pro- 
visions for its cancellation by him. 

Limitation on Number of Leases. 

Sec. 27. That no person, association, or corporation, except as 
herein provided, shall take or hold more than one coal, phosphate, 
or sodium lease during the life of such lease in any one State ; no 
person, association, or corporation shall take or hold, at one time, 
more than three oil or gas leases granted hereunder in any one 
State, and not more than one lease within the geologic structure 
of the same producing oil or gas field. 

Limitations on Corporate Holdings. 

No corporation shall hold any interest as a stockholder of an- 
other corporation in more than such number of leases; and no 
person or corporation shall take or hold any interest or interests 
as a member of an association or associations or as a stockholder 
of a corporation or corporations holding a lease under the pro- 
visions hereof, which, together with the area embraced in any 
direct holding of a lease under this Act, or which, together with 



286 MORRISON'S OIL RIGHTS 

any other interest or interests as a member of au association or 
associations or as a stockholder of a corporation or corporations 
holding a lease under the provisions hereof, for any kind of min- 
eral leased hereunder, exceeds in the aggregate an amount equi 
valent to the maximum number of acres of the respective kinds* 
of minerals allowed •to any one lessee under this Act. 

Forfeiture to U. S. May Be Ordered by Court. 

Any interests held in violation of this Act shall be forfeited 
to the United States by appropriate proceedings instituted by 
the Attorney General for that purpose in the United States Dis- 
trict Court for the district in which the property, or some part 
thereof, is located, except that any ownership or interest for 
bidden in this Act which may be acquired by descent, will, judg- 
ment, or decree may be held for two years and not longer after 
its acquisition: 

Refinery, Pipe Line and Railroad Combinations. 

Provided, That nothing herein contained shall be construed 
to limit sections 18, 18a, 19, and 22 or to prevent any number 
of lessees under the provisions of this Act from combining their 
several interests so far as may be necessary for the purposes of _ 
constructing and carrying on the business of a refinery, or of 
establishing and constructing as^a common carrier a pipe line or 
lines of railroads to be operated and used by them jointly in the 
transportation of oil from their several wells, or from the wells 
of other lessees under this Act, or the transportation of coal : 

Such Combination must be Approved. 

Provided further, That any combination for such purpose 
or purposes shall be subject to the approval of the Secretary of 
the Interior on application to him for permission to form the 
same: 

Trust or Conspiracy Ground for Decree of Forfeiture. 

And provided further, Thai: if any of the lands or deposits 



OIL LEASING ACT 287 

leased under the provisions of this Act shall be subleased, 
trusteed, possessed, or controlled by any device permanently, 
temporarily, directly, indirectly, tacitly, or in any manner what 
soever, so that they form part of, or are in anywise controlled 
by any combination in the form of an unlawful trust, with con 
sent of lessee, or form the subject of any contract or conspiracy 
in restraint of trade in the mining or selling of coal, phosphate, 
oil, oil shale, gas, or sodium entered into by the lessee, or any 
agreement or understanding, written, verbal, or otherwise to 
which such lessee shall be a party, of which his or its output is 
to be or become the subject, to control the price or prices thereof 
or of any holding of such lands by any individual, partnership, 
association, corporation, or control, in excess of the amounts of 
lands provided in this Act, the lease thereof shall be forfeited 
by appropriate Court proceedings. 

Rights of Way to Pipe Line Common Carriers. 

Sec. 28. That rights of way through the public lands, includ- 
ing the forest reserves, of the United States are hereby granted 
for pipe-line purposes for the transportation of oil or natural 
gas to any applicant possessing the qualifications provided in 
section 1 of this Act, to the extent of the ground occupied by the 
said pipe line and twenty-five feet on each side of the same under 
such regulations as to survey, location, application, and use as 
may be prescribed by the Secretary of the Interior and upon the 
express condition that such pipe lines shall be constructed, op- 
erated, and maintained as common carriers : 

Pipe Lines May Not Discriminate. Oil Lease Must Cover this 
Point, 

Provided, That the government shall in express terms reserve 
and shall provide in every lease of oil lands hereunder that the 
lessee, assignee, or beneficiary, if owner, or opreator or owner of 
a controlling interest in any pipe line or of any company operat- 
ing the same which may be operated accessible to the oil derived 
from lands under such lease, shall at reasonable rates and with- 
out discrimination accept and convey the oil of the government 



288 MORRISON'S OIL RIGHTS 

or of any citizen or company not the owner of any pipe line, 
operating a lease or purchasing gas or oil under the provisions 
of this Act : 

Forfeiture by Decree for Breach by Pipe Line. 

Provided further, That no right of way shall hereafter be 
granted over said lands for the transportation of oil or natural 
gas except under and subject to the provisions, limitations, and 
conditions of this section. Failure to comply with the provisions 
of this section or the regulations prescribed by the Secretary of 
the Interior shall be ground for forfeiture of the grant by the 
United States District Court for the district in which the prop- 
erty, or some part thereof, is located in an appropriate proceed- 
ing. 

Leases and Permits Subject to Easements. 

Sec. 29. That any permit, lease, occupation, or use permitted 
under this Act shall reserve to the Secretary of the Interior the 
right to permit upon such terms as he may determine to be just, 
for joint or several use, such easements or rights of way, in- 
cluding easements in tunnels upon, through, or in the lands 
leased, occupied, or used as may be necessary or appropriate to 
the working of the same, or of other lands containing the deposits 
described in this Act, and the treatment arid shipment of the 
products thereof by or under authority of the government, its 
lessees, or permittees, and for other public purposes: 

Easements and Surface Right May Be Reserved. Permits for 
Easements. 

Provided, That said Secretary, in his discretion, in making 
any lease under this Act, may reserve to the United States the 
right to lease, sell, or otherwise dispose of the surface of the 
lands embraced within such lease under existing law or laws 
hereafter enacted, in so far as said surface is not necessary for 
use of the lessee in extracting and removing the deposits therein : 
Provided further, That if such reservation is made it shall be 
so determined before the offering of such lease: And provided 



OIL LEASING ACT 239 

further, That the said Secretary, during the life of the lease, is 
authorized to issue such permits for easements herein provided 
to be reserved. 

Assigning; and Subletting without Permission Forbidden. 

Sec. 30. That no lease issued under the authority of this Act 
shall be assigned or sublet, except with the consent of the Sec- 
retary of the Interior. 

Lessee May Surrender. 

The lessee may, in the discretion of the Secretary of the Inte 
rior, be permitted at any time to make written relinquishment 
of all rights under such a lease, and upon acceptance thereof be 
thereby relieved of all future obligations under said lease, and 
may with like consent surrender any legal subdivision of the area 
included within the lease. 

Certain Terms to Be Expressed in Leases. To Prevent Waste. 
8 Hour Day. Wages Bimonthly. Measuring Coal. 

Each lease shall contain provisions for the purpose of insuring 
the exercise of reasonable diligence, skill, and care in the opera- 
tion of said property; a provision that such rules for the safety 
and welfare of the miners and for the prevention of undue waste 
as may be prescribed by said Secretary shall be observed, in- 
cluding a restriction of the workday to not exceeding eight hours 
in any one day for underground workers except in cases of emer- 
gency ; provisions prohibiting the employment of any boy under 
the age of sixteen or the employment of any girl or woman, with- 
out regard to age, in any mine below the surface ; provisions se- 
curing the workmen complete freedom of purchase; provision 
requiring the payment of wages at least twice a month in lawful 
money of the United States, and providing proper rules and re- 
gulations to insure the fair and just weighing or measurement of 
the coal mined by each miner, 
M. 0. R.— 19. 



290 MORRISON'S OIL RIGHTS 

Miscellaneous Covenants. 

And such other provisions as he may deem necessary to insure 
the sale of the production of such leased lands to the United 
States and to the public at reasonable prices, for the protection 
of the interests of the United States, for the prevention of mo- 
nopoly, and for the safeguarding of the public welfare*: 

State Laws to Be Respected. 

Provided, That none of such provisions shall be in conflict with 
the laws of the State in which the leased property is situated. 

Court May Cancel Lease or Allow Damages or Other Relief. 

Sec. 31. That any lease issued under the provisions of this Act 
may be forfeited and canceled by an appropriate proceeding in 
the United States District Court for the district in which the 
property, or some part thereof, is located whenever the lessee 
fails to comply with any of the provisions of this Act, of the 
lease, or of the general regulations promulgated under this Act 
and in force at the date of the lease ; and the lease may provide 
for resort to appropriate methods for the settlement of disputes 
or for remedies for breach of specified conditions thereof. 

Secretary of Interior to Prescribe Rules and Regulations. 

Sec. 32. That the Secretary of the Interior is authorized to 
prescribe necessary and proper rules and regulations and to do 
any and all things necessary to carry out and accomplish the 
purposes of this Act, also to fix and determine the boundary 
lines of any structure, or oil or gas field, for the purposes of this 
Act: 

Police Power and Taxes. 

Provided. That nothing in this Act shall be construed or held 
to affect the rights of the States or other local authority to exer- 
cise any rights which they may have, including the right to 
levy and collect taxes upon improvements, output of mines, or 



OIL LEASING ACT 291 

other rights, property, or assets of any lessee of the United 
States. 

Papers to Be Verified. 

Sec. 33. That all statements, representations, or reports re- 
quired by the Secretary of the Interior under this Act shall be 
upon oath, unless otherwise specified by him, and in such form 
and upon such blanks as the Secretary of the Interior may re- 
quire. 

The Act Applies where Surface and Mineral Rights Have Been 
Severed. 

Sec. 34. That the provisions of this Act shall also apply to aL 
deposits of coal, phosphate, sodium, oil, oil shale, or gas in the 
lands of the United States, which lands may have been or may 
be disposed of under laws reserving to the United States such 
deposits, with the right to prospect for, mine, and remove the 
same, subject to such conditions as are or may hereafter be pro- 
vided by such laws reserving such deposits. 

Distribution of Royalties. 

Sec. 35. That 10 per centum of all money received from sales, 
bonuses, royalties, and rentals under the provisions of this Act, 
excepting those from Alaska, shall be paid into the Treasury of 
the United States and credited to miscellaneous receipts; for 
past production 70 per centum, and for future production 52| 
per centum of the amounts derived from such bonuses, royalties, 
and rentals shall be paid into, reserved, and appropriated as a 
part of the reclamation fund created by the Act of Congress, 
known as the Reclamation Act, approved June 17, 1902, and for 
past production 20 per centum, and for future production 37| 
per centum of the amounts derived from such bonuses, royalties, 
and rentals shall be paid by the Secretary of the Treasury after 
the expiration of each fiscal year to the State within the bound- 
aries of which the leased lands or deposits are or were located, 
said moneys to be used by such State or subdivisions thereof f or 
the construction and maintenance of public roads or for the 



292 MORRISON'S OIL RIGHTS 

support of public schools or other public educational institutions, 
as the legislature of the State may direct : Provided, 

Naval Reserve Receipts, How Deposited. 

That all moneys which may accrue to the United States under 
the provisions of this Act from lands within the naval petroleum 
reserves shall be deposited in the Treasury as ''Miscellaneous 
receipts." 



Payment of Royalty in Kind. 

Sec. 36. That all royalty accruing to the United States under 
any oil or gas lease or permit under this Act on demand of the 
Secretary of the Interior shall be paid in oil or gas. 

Secretary May Sell Oil and Gas Royalty. 

Upon granting any oil or gas lease under this Act, and from 
time to time thereafter during said lease, the Secretary of the 
Interior shall, except whenever in his judgment it is desirable 
to retain the same for the use of the United States, offer for 
sale for such period as he may determine, upon notice and ad- 
vertisement on sealed bids or at public auction, all royalty oil 
and gas accruing or reserved to the United States under such 
lease. Such advertisement and sale shall reserve to the Secre- 
tary of the Interior the right to reject all bids whenever within 
his judgment the interest of the United States demands ; and in 
cases where no satisfactory bid is received or where the ac- 
cepted bidder fails to complete the purchase, or where the Secre- 
tary of the Interior shall determine that it is unwise in the pub- 
lic interest to accept the offer of the highest bidder, the Secre- 
tary of the Interior, within his discretion, may readvertise such 
royalty for sale, or sell at private sale at not less than the mar- 
ket price for such period, or accept the value thereof from the 
Jessee: 

Private Sale of Royalty. 

Provided, however, That pending the making of a. permanent 



OIL LEASING ACT 293 

contract for the sale of any royalty, oil or gas as herein provided, 
the Secretary of the Interior may sell the current product at 
private sale, at not loss than the market price: 

Departmental Pre-emption Right to Royalty. 

And provided further, That any royalty, oil, or gas may be 
sold at not less than the market price at private sale to any de- 
partment or agency of the United States. 

All Locations before Passage of Act Protected with Right to 
Perfect Discovery. 

Sec. 37. That the deposits of coal, phosphate, sodium, oil, oil 
shale, and gas, herein referred to, in lands valuable for such 
minerals, including lands and deposits described in the joint 
resolution entitled 1 "Joint resolution authorizing the Secretary 
of the Interior to permit the continuation of coal mining opera- 
tions on certain lands in Wyoming," approved August 1, 1912 
(Thirty-seventh Statutes at Large, page 1346), shall be subject 
to disposition only in the form and manner provided in this Act, 
except as to valid claims existent at date of passage of this Act 
and thereafter maintained in compliance with the laws under 
which initiated, which claims may be perfected under such laws, 
including discovery. 

Fees and Commissions to Land Officers. 

Sec. 38. That, until otherwise provided, the Secretary of the 
Interior shall be authorized to prescribe fees and commissions 
to be paid registers and receivers of United States land offices 
on account of business transacted under the provisions of this 
Act, 

Approved, February 25, 1920. 

1 This joint resolution refers to coal entries numbers 18 to 49 by the 
' Krl Creek Coal Company in the Land Office at Lander, Wyoming. 



-94 MORRISON'S OIL RIGHTS 

ANALYSIS OF THE ACT. 
Section 1. 

-Minerals and Territory Covered. Helium. 

The Act is confined to coal, phosphate, sodium, oil, oil shale 
and gas lands. Helinm is reserved to the United States. It 

applies to claims of right to such minerals anywhere on the 
unoccupied Public Domain including National Forests. 

Exclusions. 

It Excludes: 

1. National Parks. 

2. Military and Naval Reserves. 

3. Lands Segregated under the Appalachian Act mentioned 

in Sec. 1, which refers to certain parks. 

4. Indian Lands, by implication. See page 262. 

Parties. 

The parties entitled to the benefits of the Act are: 

1. Citizens. 

2. Associations of citizens. 

3. Corporations organized under laws of the United States 

or of any State or Territory. 

4. Municipal Corporations limited to coal, oil, oil shale and 

gas. 

Reciprocity. 

An attempt is made to forestall the acquisition of oil inter- 
ests by alien citizens of countries whose laws do not confer like 
privileges on citizens of this country. 

Sections 2-8 

Are the only part of the Act which is confined to coal. But 
this mineral is included in the general provisions of sections 



OIL LEASING ACT 29") 

26-37 which are applicable to all the leases and permits covered 
by the Act. 

The Act repeals by implication all the Statutes allowing pur- 
chase of coal land and brings such land under the leasing sys- 
tem. 

Alaska coal is expressly excluded because covered by special 
law printed in chap. 86, and coal applications pending which 
have become vested rights may be advanced to patent. 

Sections 9-12. 

These four sections are confined to Phosphates which have no 
special mention elsewhere in the Act. 

-Phosphates are mentioned in the withdrawal Act of 1911, 36 
St. L. 847. By this Act prospecting for phosphates ceased to 
lie legal. They were not released by the amendment of .1.912, 
m St. L. 497. By Act of 1915, 38 St. L. 792, agricultural en- 
tries were allowed excepting phosphates and other minerals. 
All these Statutes seem to have no future application as the 
phosphate lands come under the experiment of the leasing sys- 
tern. 

Sections 13-17. 

These are the five sections confined to oil and gas. The gen- 
eral provisions, sections 26-37 of course cover them when perti- 
nent. 

Sections 13* to 16 are restricted to claims outside the known 
geological structure and section 17 is limited to claims within 
the known geological structure. 

Oil, the principal mineral, the importance of which was the 
inducement to passage of this Leasing Act, was the subject of 
several Acts of Congress which are enumerated on 4 page 224. 
Practically, oil claims were treated merely as' a form of placer 
locations. 

The Act at the outstart divides the public domain into two 
divisions; 

(1) Where the oil is found in a known geological structure; 



296 MORRISON'S OIL RIGHTS 

(2) Where found elsewhere, that is, in territory not previous- 
ly developed or proved up. 

When oil is sought on land outside the known geological 
structure, the procedure is to post notice on the claim and apply 
for a permit to work it. If this permit results in finding pay oil 
the permittee obtains a lease at a small royalty on one fourth of 
the ground and the other three-fourths are advertised for com- 
petition bids ; the original permittee having no special privileges 
on this three quarters, except, that if no other bid exceeds his 
own, he has a pre-emption right to become the lessee. Unless he 
exercises such right these three-fourths are let to the highest 
bidder. 

Section 13 

Prescribes the conditions upon which preference rights, per- 
mits, and leases will be granted upon the undeveloped oil lands. 

Section 14 

Enlarges upon the same ground partly covered by 13, giv- 
ing the procedure to obtain lease after the permittee has been 
allowed the right to a lease. It gives the term of the lease on 
one fourth of the land and describes the permittee's limited 
rights to a preference on the other three f ourts. 

m 

Section 15 

Merely provides for a twenty per cent, royalty on the oil or 
gas produced during the interval between the first strike of 
mineral and the date of the permittee's application for a lease 
for his one fourth. 

Section 16 

Provides for a protection of 200 feet and for precautions to 
prevent waste. 



OIL LEASING ACT 297 

Section 17 

Is the only section confined to procedure to obtain a lease on 
ground within the known geological structure. 

Oil Land Within the Known Geological Structure. 

On this land no permits are granted. They are to be 
divided into tracts not exceeding 640 acres and advertised for 
lease to the highest bidder. The royalty is to be fixed in the 
advertisement. As no oil is supposed to have been tapped on 
any such tract, the fixing of the royalty must be therefore more 
or less arbitrary. The acreage rent has also at this point become 
a fixed amount. As both royalty and rent are already deter- 
mined the competition will be on the bonus bid; whoever offers 
the highest bonus becomes the lessee. 

Section 18 

Is confined to claimants of wells covered by the withdrawal 
proclamation of September 27, 1909, where oil had been discov- 
ered since that date and whose locations would have been valid 
vested rights except for the want of discovery at the proper 
time. The condonation as to time of discovery opens them to 
lease to the extent of one half of the area but with no protection 
as to minimum royalty. 

Upon acceptance of a lease under its terms, suits already 
brought by the Government are to be settled in compliance with 
the Act of 1914 which it cites, and the impounded royalties re- 
leased. 

Included in the section are the repetition of the fraud clause 
and limitations as to acreage with no less than six provisos, ar- 
ranged with no conformity to any orderly sequence. 

This section is confined to a class of claims but few in num- 
ber, some of them, however, doubtless of great value, whose 
owners were ready to comply and did promptly comply with 
the requirements within the six months period. And if no appli- 
cation was made under this section we do not apprehend that 
they lost any rights which they might have under other pro- 
visions of the Act. 



298 MORRISON'S OIL RIGHTS 



Section 18A. 



Section 18a is confined to the settlement of certain Govern- 
ment suits, involving claims on the area covered by the Procla- 
mation and authorizes their compromise within one year by 
exchange or division of land, or its proceeds. It is supple- 
mental to the Act of August 25, 1914 which w r as restricted to 
the oil product and did not cover the title to the real estate. 
There can be but few claims affected by this section and the 
necessity for the section seems difficult to understand unless it 
was to bring in Presidential approval to the compromise of such 
a controversy. 

Section 1V> 

Covers the instance where the claimant: 

1. Had a bona, fide occupancy on October 1, 1919. 

2. On a claim initiated before the land was withdrawn. 

3. Valid except as to discovery. 

1. And no discovery prior to the passage of the Act. 

5. And who had expended $250 on each location. 

Such claimant is allowed a prospecting permit on application 
filed within six months. Where such claimant had a discovery 
before the passage of the Act he is entitled to a lease. 

The first class of beneficiaries under the section are allowed 
a permit because they have as yet no discovery. 

The second class who have a discovery, but a discovery too 
late to give them a vested title, are under this section allowed 
to apply for a lease at not less than twelve and a half per cent, 
royalty,, The benefit of the section to this second class seems to 
he to relieve them from paying any bonus but they have no 
protection against the imposition of a heavy royalty. 

And the six months limitation does not seem to apply to this 
second class, although a construction to the contrary might possi- 
bly be forced. 

Section 20 

Gives a preference right to a permit and to a lease to the 
holders of the agricultural or surface title. That appears to 



OIL LEASING ACT 29!' 

be its only scope. The assignee ''where assignment was made 
prior to January 1, 191 .8" comes under the section. We do not 
know r why this date of January 1, 1918, was fixed. Apparently 
the original patentee of the surface has this preference right 
indefinitely but his assigns, under assignment later than that 
date, would not have the right if the terms of the section are 
closely construed. 

The general terms of Section 34 as to severed lands (where 
surface has been patented reserving the minerals) would doubt- 
Jess be qualified by this section 20 referring specially to this class 
of lands. 

' Section 21. 

Oil Shale was placer ground before the Act but is now for the 
first time mentioned in terms and made a class by itself. 

This oil shale section is peculiar and requires consideration in 
connection with the construction which the Department places 
upon it. We have no hesitation in stating that oil shale claims, 
regular in every respect, were just as valid as any other form 
of placer location. 

The language of the oil placer Act is : 

"That any person may enter and obtain patent to lands con- 
taining petroleum or other mineral oil and chiefly valuable 
therefor, under the provisions of the laws relating to Placer 
Mineral Claims," Act of 1897, 29 Stat. L. 526. 

And the Act of 1903, 32 St. L. 825, concerning annual labor 
on oil placers speaks of "Oil Lands" and "oil bearing character" 
expressions which refer as clearly to shale as they do to liquid 
oil. 

It is true that Oil Shale Claims as such, were not generally 
known when those Acts were passed, but they come within both 
the letter and the spirit of the Statutes and conform to the -gen- 
erally accepted construction of the same. 

The construction of this section as to the beneficiaries under 
it (Oil Shale Regulation 7) in using the words "honest belief" 
implies a doubt as to their being locatable which the Statutes 
do not justify, and they are recognized by name both in the 
title of the 1920 Act and in its Saving Section 37. 



309 MORRISON'S OIL RIGHTS 

The same regulation speaks of lode locations on Shale. Al- 
though not common, some shale records are sound in the form 
of lode locations and in fact shale has much in its mode of 
deposition to suggest a lode location. It is in place in solid 
rock and has small resemblance to a placer deposit of gold bear- 
ing gravel. 

It would come within the defintion of a lode in U. S. v. Ohio 
Oil Co., 240 Fed. 996 and in San Francisco Chemical Co. v. 
Dnffield, 201 Fed. 830. In Webb v. American Asphalt um M. 
Co., 157 Fed. 203, it is held that Lode claims are not confined 
to metaliferous deposits. If it were not for the wording of the 
Statutes quoted it would be difficult to say that a shale bed 
should not be located as a Lode. 

Under the above construction, whether lode or placer may 
not often be material, but we never could see the necessity for 
holding in any class of claims that a location of a placer as a 
lode should be a fatal error. And after patent it has been held 
to be valid beyond question. Peabody M. Co. v. Gold Hill M. 
Co., Ill Fed. 817, 49 C. C. A. 637, 21 M. E. 591. 

A ruling of May 19, 1920, in re Yerner Z. Reed, — L. D. — , 
Land Service Bulletin for June 1920, page 50, recites the pre- 
vious holdings of the Department on oil shale and concludes 
with the following specific affirmance of the validity of placer 
locations on Oil Shale Deposits: 

"Oil shale having been thus recognized by the Department 
and by Congress as a mineral deposit and a source of petroleum, 
and having been demonstrated elsewhere to be a material of 
economic importance, lands valuable on account thereof must 
be held to have been subject to valid location and appropria- 
tion under the placer mining laws, to the same extent and sub- 
ject to the same provisions and condition as if valuable on ac- 
count of oil or gas. Entries and applications for patent for oil 
shale placer claims will, therefore, be adjudicated by your office 
in accordance with the same legal provisions and with reference 
to the same requirements and limitation as are applicable to oil 
and gas placers." 



OIL LEASING ACT 301 

Section 22 

Is the only section which is confined to Alaska bnt the Terri- 
tory is mentioned in Sections 2, 13 and 35. In sections 2, to 
exclude it entirely from the coal leases; in section 13 to allow 
prospecting permits in that Territory and in section 35 as to the 
disposition of the income received under the Act, from Alaska. 

Sections 23-25 

Bring sodium compounds under the lease system. Sodium 
compounds include borax and some of its combinations exist of 
commercial value in solution in water. The sections above men- 
tioned provide for prospecting permits for two years to be fol- 
lowed by lease's on one-half the ground covered by the permit at a 
minimum royalty of -J. A forty acre sodium mill site is also 
allowed. 

Section 26 

Gives the Secretary of the Interior the power to cancel the 
prospecting permit on any form of mineral for want of diligence 
but no such authority is granted to cancel the lease and appar- 
ently this is the only cancellation allowed by the Act without 
judicial decree. 

Section 27 

Limits the number of leases on coal, phosphates, sodium, oil 
or gas and attempts to limit corporate holdings, with provisions 
to. allow of combinations for refineries, pipe lines or railroads 
under certain limitations. 

Section 28 
Is confined to pipe lines and other easements. 

Section 29 

Makes all leases and permits subject to the reserved easements, 
provides for the joint use of easements and allows second leases 



302 MORRISON'S OIL RIGHTS 

to be superinposecl on the original lease with the material })ro- 
viso that in such case the right to make such super-lease must 
have been determined before the offering of the original lease. 

Section 30. 

Sub-leases and assignments are forbidden by this section ex- 
cept by consent of the Secretary. Surrender, in the section 
styled "Relinquishment/' is provided for under like consent 
which right of surrender "by consent" is implied in every con- 
tract in the nature of things. The section further prescribes 
certain clauses to protect workmen and to prevent waste and 
other precautionary clauses which are embodied in the printed 
form contained in the regulations. 

The power of the Secretary of the Interior to make rules and 
regulations is mentioned in nineteen out of the thirty-eight sec- 
tions of the Act. 

Section 32 gives the general power "to prescribe necessary 
and proper rules and regulations and to do any and all things 
necessary to carry out and accomplish the purposes of this Act." 

Under section 2, the Secretary may by general regulations 
prescribe the mode of offering coal lands for leasing and by 
section 8 he may prescribe regulations in advance for the limited 
licenses for free coal. 

Under section 9, he is authorized to lease phosphate lands by 
any methods which he may, by general regulation adopt, he may 
also prescribe regulations for the survey of phosphate ground 
and by section 11 may prescribe the conditions of the readjust- 
ment of phosphate leases. 

Under section 13, he may prescribe rules for oil and gas per- 
mits upon undeveloped fields. By section 14 he may prescribe 
regulations for the survey of such lands and fix by regulation 
how the royalty is to be determined on the lease. 

He may prescribe under section 17 general regulations for 
the competitive bidding of the oil blocks on the known geological 
structure and for renewals under that section. 

Under section 18 he may prescribe regulations to fix the royalty 
on oil and gas leases. And by section 19 prescribe terms of lease 
under that section. 



OIL LEASING ACT -\0o 

Under section 21 he may prescribe rules "not inconsistent 
with this Act" for the disposition of oil shale land and the re- 
duction of the leased mineral. 

Under section 22 he may fix the rents and royalties in Alaska 
oil leases. 

Under sections 23 and 24 he may prescribe regulations for 
permits on sodium claims and for the survey of such claims and 
to regulate the granting' of permits or leases on such claims and 
their readjustment and the covenants in sodium leases. 

By sections 28 and 29 he may prescribe regulations as to the 
grant of pipe line easements and in any lease under the Act, if 
any surface reservations are made, it must be determined before 
the offering of the lease. 

Under section 30, he may make general rules for the safety pro- 
visions of the lease to protect miners in their persons and their 
dues, with a sweeping clause "for the protection of the interests 
of the United States, for the prevention of monopoly and the 
safeguarding of the public welfare." 

In section 31 where provisions are made for the cancellation 
of the lease by decree of court for breaches generally, where 
regulations are mentioned, they must be "in force at the date 
of the lease" which by implication prohibits the promulgation 
of any retroactive regulations. This clause assimilates the law 
to the decisions concerning by-laws of corporations which are 
not allowed to be retroactive. 

Section 31 

After calling for judicial proceedings to set aside a lease in a 
later clause allows the lease to "provide, for resort to appro- 
priate methods for the settlement of disputes or for remedies 
for breach of specified conditions thereof." 

The two inconsistent remedies thus provided for bring up the 
question as to the extent to which the Interior Department may 
take ex parte action against the leasee and we cannot assume 
that the latter provision extends further than to provide for 
arbitration or for suit for damages ; certainly the cancellation of 
the lease is limited to judicial decree only. It will be noted 
that Section 26 allows the Secretary to cancel a permit for 



304 MORRISON'S OIL RIGHTS 

violation of its terms but this power is not allowed to cancel 
a lease which must be by decree of court. Paragraph No. 6 
of the form of lease printed with the regulations is apparently 
drawn so as not to concede this point. But if the Secretary 
is allowed by his own ruling to cancel the lease all legal pro- 
tection to the lessee is practically gone. 

In the passage of the bill two conflicting interests were at 
work; one contending for absolute authority of the department 
to control and dispose of the oil lands without judicial restraint. 
The other contended for judicial protection to the oil claimant ; 
and on this point of cancellation and on several other points 
scattered through the Act the authority of the Courts is main- 
tained. 

Section 32 

Authorizes in broad and general terms the promulgation of 
rules and regulations. It further provides for the determination 
of the boundary lines of the gas fields mentioned in the oil 
sections of the Act and recognizes the police power of the States 
and the taxing power. 

Land Office Regulations. 

The predominant feature of the whole Act is the practical 
surrender of the oil domain to the Regulations of the Interior 
Department. These control the permits and the leases and 
all details and the department retains general superintendence 
during the lifetime of the lease. 

Sections 33-36. 

Section 33 provides for verifications, forms and blanks. Sec- 
tion 35 covers the distribution of royalties and section 36 pro- 
vides for the payment of royalties in kind and also for the sale 
of the royalty as a separate interest. Section 34, a sweeping 
provision for surface severance, is necessarily controlled by 
section 20 as above mentioned under that section. 



OIL LEASING ACT 305 

Section 37. 

Saving Clause. Future Discovery Allowed. 

This is perhaps the most material section of the Act as it 
saves the rights of claims. of all sorts held by valid location be- 
fore the passage of the Act and also gives the right to oil claims 
valid in other respects to perfect their title by making a dis- 
covery. 

The Land Office Construction of the Saving Section. 

On claims located on the withdrawn land, which are relieved 
by the Pickett Act, the work of continuous oil seeking must be 
diligently kept up. But the statutory requirement of diligence 
is restricted to this class of claims. The other class, those valid 
in all respects by compliance with the local laws and Federal 
Statutes, seem to be covered by the Saving Section. 

Section 37, leaving out the parenthetical break, reads: "that 
the deposits of coal, phosphate, sodium, oil, oil shale, and gas, 
herein referred to, in lands valuable for such minerals: * *■ . * 
shall be subject to disposition only in the form and manner pro- 
vided in this Act, except as to valid claims existent at date of 
passage of this Act and thereafter maintained in compliance 
with the laws under which initiated, which claims may be per 
fected under such laws, including discovery." 

As to possessory claims in general it has been decided that 
the government does not require that they be hastened to patent, 
but allows them to be held indefinitely by performance of the 
annual labor. No other condition is imposed directly by Act 
of Congress nor implied by deductions from the principles of law 
applicable to the construction of every kind of legislation. There 
are thus two sorts of claims defective in the matter of discovery : 

1. Claims on withdrawn lands covered by the Pickett Act 
where the search for oil must be diligently prosecuted. 

2. Placer claims valid in every respect except as to discovery 
which the 1920 Act says are thereafter to be "maintained in 
compliance with the laws under which initiated." 

"The laws under which initiated" can refer only to the original 
M. 0. R.— 20. 



306 MORRISON'S OIL RIGHTS 

Act of 1872 and its amendment of 1880, R. S. Sec. 2324, impos- 
ing annual labor and the subsequent statutes referring specifically 
to Oil Placers but adding no new conditions as to their initiation 
or continuous holding. 

By the laws under which "initiated" annual labor is the sole 
condition imposed and we know of no statute which introduces 
or adds any new condition. 

The only line of argument which would tend to support a 
construction fatal to claims, protected by annual labor but not 
by diligent search, would be, by consideration of the present 
economic and political situation, taking a composite view of the 
whole subject of oil production. If such view is taken the out- 
come would be problematical. If production is to be encouraged 
it would be better to let such claims come under the leasing Act 
and be possibly exploited by successful permits. If oil produc- 
tion is to be discouraged it would be better to let them remain 
in the hands of the idle locators. But when law is construed 
by resort to such line of reasoning it is no longer the interpre- 
tation of a statute but a judicial suggestion as to what the law 
ought to be. 

Section 38. 

Refers only to the prescribing of Land Office Vees and com- 
missions by the Secretary of the Interior. 



CHAPTER 66. 

PERMIT AND LEASE ON NONPROVEN GROUND. 

The Act divides oil and gas lands at the ontstart into two 
divisions, to wit : 

1. Lands on a known geologic structure. 

2. Lands which are not proven as to their oil values. 

The procedure on the nonproven ground is by permit followed 
by lease. On the geologic structure a lease issues on accepted 
bid without any previous permit. 

The procedure on the other minerals mentioned is also by 
lease without the necessity of permit, except that on coal lands 
under section 2 a prospecting permit is allowed under certain 
circumstances. And on, sodium by section 23. 

The area covered by the permit must not exceed 2560 acres 
(which is 4 square miles or sections) and must be on land "not 
within any known geological structure of a producing oil or 
gas field." Sec. 13. 

Whether the land on which permit is asked, is within such a 
geological field as is mentioned in Section 13, is to be determined 
by the maps filed by the geological survey and transmitted to 
the local Land Office. Rule 2. This is probably the only prac- 
tical method by which such fact could be determined and ex- 
cept possibly in an extreme case the Courts would hardly in- 
quire into the question of fact as to whether or not, such geolog- 
ical maps were correct. 

As oil is the principal mineral, we consider it first and this 
chapter covers the procedure leading up to permit and lease on 
the nonproven ground followed in the next chapter by the ma- 
terially different practice to secure lease on land within the 
geologic or geological structure, which is the arbitrary term used 
in the Act to designate the field or portion of the field which 
is recognized as producing or proven territory. 

Later we print the rules and endeavor to collate them with the 
proper sections of the Act. 

307 



308 MORRISON'S OIL RIGHTS 

Procedure by the Claimant to Procure Permit. 

Assuming that a party desires to prospect for oil outside the 
known geological structure and is a citizen of the United States 
or represents an American corporation and has in view the par- 
ticular ground he desires to secure and that such ground has been 
surveyed by the government, he proceeds as follows: 

Preliminary Monument. 

The first step before applying for a permit is to erect a pre- 
liminary monument which should be a stake of wood or iron, 
usually wood, not less than 4 feet in height and at least 4 inches 
in diameter both ways, sunk in the ground at some conspicuous 
place on the land. 

It is usually put in the center but this is immaterial provided 
it be in a conspicuous place. 

This stake must display a notice in writing. Sec. 13. Rule 5, 
subsection b. 

The following form explains what it contains: 

NOTICE OF INTENDED APPLICATION FOR PERMIT. 

Notice is hereby given that the undersigned C. W. Thompson 
of Denver, Colorado, within thirty days after date of posting 
this notice, will apply to the Hon. Secretary of the Interior for 
a prospecting permit for oil and gas on this land, being the 

Northeast quarter of Section Township South, 

Range containing 160 acres in County, Wyoming. 

The Northeast corner stake of said quarter section bears 
northeast from this monument 560 feet. 

A prominent butte known as Skeleton Butte, bears southwest 
from monument about one mile. 

A bearing tree, cottonwood, 12 inches diameter, marked B. T. 
bears 25 feet due west from the southwest corner of the quarter 
section. 

Date of Posting. 
June 1, 1920, at 10 A. M. C. W. Thompson. 

The rules do not require any witnesses to this notice. 



PERMIT OxV NONPROVEN GROUND 309 



Signature. 



Rule 5 subsection b. says "to be signed by the applicant" but 
we do not apprehend that this requires his personal signature, 
and the Department has ruled that an agent may post the no- 
tice. See page 377. 

The actual signature on notices and location certificates on 
mining claims has never been required and if the notice is on a 
board, it would be often impossible to place such a signature as 
could be identified as the personal subscription of the signer. 

Having placed such monument and posted such notice, the ap- 
plicant within thirty days from date of posting applies for a 
prospecting permit by filing his petition or application in the 
local Land Office. 

Contents of Application for Permit. 

The Regulations, rule 4, do not give a form but prescribe the 
contents of the application. 

The application should of course have a proper address, should 
identify the land desired, should show that the applicant is a 
party entitled to apply and that he has complied, with the regu- 
lations and in all respects comes within the provisions of the Act. 
By a recent ruling the Department has held that an agent or 
attorney in fact may locate a claim but that the party in whose 
interest the claim is located must file the application for a permit. 

Subsections a and b of rnle 4, are self explanatory, as tc 
citizenship. 

Subsections c, d, e and f can readily be complied with and an 
instance is covered in the form printed below. 

Subsection g is one which the department has perhaps no 
right to require beyond enough to identify the party, with his 
age, address and other incidents sufficient to raise the ordinary 
presumption of respectability and good citizenship. Certainly. 
a man who has had no previous experience in oil seeking has as 
much right to prospect for it as one who has either lost or gained 
by previous ventures, and to insist on a strong showing under 
this clause could be justified only on the theory that the de- 
partment is under no legal obligations to grant a permit to a 



310 MORRISON'S OIL RIGHTS 

qualified person who has fully complied with the Act and the 
rules, as a matter of right. 

Preference Right. 

Subsection h refers to the matter of preference right. 

It seems that the applicant for permit may file his petition 
without any preliminary monument or notice and if no other 
party intervenes, he will secure his permit in due time. 

The office of the preliminary monument and notice above men- 
tioned is to hold the land for thirty days against later coiners. 
If he should file his petition without his monument and notice, 
another could place a hostile monument and notice and obtain 
precedence. The petition for permit of such second party altho 
filed later, would take precedence of the first filing. 

But he cannot dispense with locating his ground which, wheth- 
er on. a government subdivision or on a special survey, would be 
by marking his corners, or seeing at least that the stakes were in 
place and on either sort of survey, placing the monument stake 
and notice of his claim on the ground. All this seems unneces- 
sary if he is not seeking a preference right and yet some mean- 
ing should be given to the words "locate such lands" used in 
section 13. 

So that practically, it is advisable that he plant his stake and 
notice, after marking his corners just the same as if he sought 
a preference right, because he could not locate without doing 
substantially the same thing. 

The filing of location certificate in the County Recorder's of- 
fice, doubtless is no longer required. The Act on this point of 
location is as obscure as it conld be drawn but to place monument 
and notice and mark corners would certainly comply with it. 

The preliminary monument and notice and the location pre- 
cede the application and such location notice and monument 
operate for thirty days to give a preference right, that is to say; 
the applicant has thirty days from the date of monumenting to 
file the application for permit. If there is delay in the issue of 
the permit not chargeable to the applicant, no loss falls npon 
the applicant seeking to become a permittee. 



PERMIT ON NONPROVEN GROUND 311 

Compliance with subsection h of rule 4, is complete by stating 
that he has posted his notice, with the allegation that no otfier 
notice has been posted or that he has the prior notice, attaching 
a copy of it. 

Subsection i refers to the bond which as a matter of conven- 
ience in almost every case would be by a surety company. 

It would seem from rules 4 and 5 that any number of persons 
may separately apply for permits on the same land, in which 
case their applications would be considered, presumably in the 
order of their receipt at the local Land Office, but if a party ap- 
plying wishes to anticipate and cut out other applications after 
his preliminary monumenting, he must do the things above 
stated, which give him a preference right. 

This preference right is not evidenced by any separate paper 
nor in fact by any paper at all. It is merely the legal effect or 
result of compliance with the Statute and regulations. 

If the applicant has no fear of other applications, he can 
apply for his permit without any suggestions about preference 
rights. 

Conflict Between Applications. 

As to priority contests between one who files in the Land Of- 
fice his application for permit without having posted the notice 
to secure a preference right and one who has posted his notice to 
secure a preference right, but is subsequent in filing his applica- 
tion for a permit, Rule 5, subsection c. says: 

"In cases of conflict between a preference right application 
and one filed without any claim of preference, the priority of the 
initiation of the claim will govern, for example, the filing of a 
proper application in the land office prior to the posting of notice 
by another, as aforesaid, will give a prior right." 

To determine this point requires a close analysis of the lan- 
guage of Section 13. 

It says that the party who posts and monuments is entitled 
to a "preference right over others/' This cannot possibly refer 
to those who come later either as posters or filers of applications. 
As a matter of course, the poster would have a preferencejright 
over such later comers without any statutory grant of such 
preference right. Tt would seem logically to refer to those seek- 



iJ12 MORRISON'S OIL RIGHTS 

ing to assert some claim to the same land who had some pretence 
to priority and such class conlcl only be parties who had filed 
their applications without posting, but had not so far progressed 
as to become entitled to a permit. As to when, under the obscure 
language of the Section, the right to the permit becomes a vested 
right it is impossible to state with certainty. 

The interpretation of the Land Department, who act under 
the advice of able lawyers, is entitled to great respect and may 
be right, but certainly some meaning should be given to the w r ord 
"preference" and a class of persons must be formed who are the 
"others" against whom the preference operates. 

On this view of the Act it becomes a debatable question and 
an argument in favor of the poster may be presented perhaps 
equally strong as that which may be advanced in favor of the 
Land Office construction. 

FORM OF APPLICATION FOR PERMIT. 

To the Honorable the Commissioner of the General Land 
Office : 

Your petitioner C. W. Thompson of the city and county of 
Denver, State of Colorado whose Post Office address is 1812 
Lawrence St., Denver, Colorado, respectfully represents: 

That he is a native born citizen of the United States and here- 
to attaches his affidavit of citizenship. 

That he does not hold any permit and that he has not ap- 
plied for any permit other than the one now petitioned for. 

That the land for which he desires a permit is the N.E. J of 
Sec Twp S. R W., containing 160 acres. 

That he believes the land applied for is a favorable field for 
prospecting for oil, because he knows that oil has been found on 
other land in the same State with similar topography and appais 
ently of the same geological formation, but that the land ap- 
plied for is not within any known geological structure of a pro- 
ducing oil or gas field as is shown by the fact that it is not in- 
cluded within any of the maps filed by the geological survey 
in the Land Office of the District in which it is situate. 

That your petitioner proposes to conduct exploratory opera- 
tions on said land by sinking at a point near the center of said 
quarter section with a derrick and drill for which he has con- 



PERMIT ON NONPROVEN GROUND 313 

t meted (or for which he is about to contract) and has secured 
the money, $20,000 for such derrick and sinking, and that he 
expects to commence to sink within 60 days from the date of 
securing permit and to continue said sinking without intermis- 
sion to the depth of 2000 feet unless oil or gas is sooner found. 

That your petitioner has been in the business of oil sinking 
and oil producing for at least two years and has been interested 
in the sinking of and production from, one well in said county, 
(or) 

That your petitioner has had no previous experience in opera- 
tions of this nature, but has the education and capital necessary 
to qualify him to work under permit as petitioned for. 

Your petitioner refers to the International Trust Company, 
Denver and J. K. Mullen of 896 Pennsylvania street, Denver, 
as to the reputation and business standing of your petitioner. 

Wherefore, petitioner asks that the department issue to him 
a permit to work and operate said described land under the 
terms of the Act generally known as the Oil Leasing Act ap- 
proved March 25, 1920, and the rules and regulations issued 
thereunder. 

C. W. Thompson. 
Verification. 

State of Colorado, ) 

■ { ss. 

City and County of Deliver.^ 

Before me the subscriber, a Notary Public in and for said 
City and County personally appeared C. W. Thompson of law- 
ful age, who being first duly sworn saith that he is the Petitioner 
named in the foregoing application for Permit. 

That he has. read the same and knows the contents thereof, 
and that the same and the matters and things therein stated are 
true of his own knowledge. 

C. W. Thompson. 

Subscribed and sworn to before me this 10th day of July, 
A. D. 1920. 

My commission expires September 26, 1923. 

Frederic A. Fleming. 
[seal] Notary Public. 



314 MORRISON'S .OIL RIGHTS 

The application being filed and acted on in due course, the 
permit issues which would be transmitted to the local Land 
Office and delivered to the permittee. 

Bond of Oil and Gas Permittee. 

Under regulation 4 (i) it was provided that the application 
should be accompanied by a bond witli qualified corporate surety 
in the sum of one thousand dollars, and in Circular No. 676, 
issued March 25, 1920 by the Commissioner the form of bond is 
given. In a letter of the department dated June 12, 1920, found 
in the July Land Service Bulletin, it is said, referring to the 
bond regulation : "We have interpreted this regulation to apply 
only to permits granted, and not to applications for permit. Of 
course, the permittee in lieu of a corporate bond may deposit cash 
or Liberty Bonds of the face value of $1,000." 

Under the above construction the permit when issued, will be 
delivered upon the execution of a sufficient bond or deposit of 
security above suggested. The form of the bond is as follows : 

Department of the Interior, 

General Land Office. 

U. S. Land Office- 
Serial Number 

BOND OF OIL AND GAS PERMITTEE. 

Act of February 25, 1920 (Public No. 146). 

Know all men by these presents, That we, , 

of the county of , in the State of , as principal, and 

of the count v of , in the State of , 



as surety, are held and firmly bound unto the United States of 

America in the sum of dollars, lawful money of the 

United States to be paid to the United States, for which pay- 
ment, well and truly to be made, we bind ourselves, and each of 
us, and each of our heirs, executors, administrators or successors, 
and assigns, jointly and severally by these presents. 



PERMIT ON NONPROVEN GROUND 315 



Signed with our hands and sealed with our seals this 



day of in the year of our Lord one thousand nine hundred 

and . 

The condition of the foregoing- obligation is such that, whereas 
the said principal has made application under the act of Feb- 
ruarjr 25, 1920 (Public No. 146), for a permit to prospect for 
oil and gas for two years upon the following described lands 



and whereas said permit, if granted, will be on condition that all 
operations shall be conducted in accordance with approved meth- 
ods; that all proper precautions shall be exercised to prevent 
waste of oil or gas developed in the lands, or the entrance of 
water through wells drilled by, or on behalf of, the principal to 
the oil sands or oil-bearing strata to the destruction of the oil 
deposits. 

Now therefore, if said principal shall promptly repair any 
damage that may result to the oil strata or deposits resulting 
from improper methods of operation, or from failure to comply 
fully with the aforesaid conditions of said permit, then the above 
obligation is to be void and of no effect ; otherwise to remain in 
full force and virtue. 

Signed, sealed, and delivered in presence of — 

Name and address of witness: 



[a 8.] 

Principal. 

[L. S.] 

Surety. 
Very respectfully, 

Clay Tallman, 

Commissioner. 
Approved March 25, 1920. 
John Barton Payne, 

Secretary, 



316 MORRISON'S OIL RIGHTS 

Regulation 6 gives the form of the permit, page 334. 

Within ninety days after the date of the permit the permittee 
must mark each corner with substantial monument and post in 
a conspicuous place on the ground a notiee that the permit has 
been granted, with a description of the land covered by such 
permit. Sec. 13. 

When the permit is upon officially surveyed land we advise 
that the corners should be marked and the stakes reset, if miss- 
ing, marking each corner with the name or initial of the per- 
mittee and the number of the permit, the same as when there 
has been special survey. 

The bearings when the land is a subdivision of a government 
survey seem of little value but they are apparently required, the 
same as if there had been only a special survey. 

When the ground selected by the permittee is not a legal sub- 
division he must advance the cost of special survey to segregate 
it. Sec. 14. 

The other three quarters are advertised for competitive bid- 
ding. Sec. 14. 

Sec. 13 of the Act requires as to the notice only two condi- 
tions and the regulations do not add any more, to wit: 

That such permit has been granted and a description of the 
land covered thereby. 

NOTICE THAT PERMIT HAS BEEN GRANTED. 

Notice is hereby given that a permit has been .granted to pros- 
pect for oil and gas on this land to C. W. Thompson of Denver, 
Colorado, by the Hon. Secretary of the Interior, dated June 1, 
1920 upon the northeast quarter (repeating the same descrip- 
tion as in the form last above including the bearings) rule 5, b. 
Date of Posting. 

July 10, 1920 at 10 A. M. C. W. Thompson. 

The above notiee is drafted from section 13 of the Act and in 
compliance with the demand contained in the Permit found in 
subsection 1 of rule 6. 

This is all that is required of the permittee except to drill and 



PERMIT OX NONPROVEN GROUND 317 

continue his prospecting; under conditions which are clearly set 
forth in the permit. 

In general terms he has six months from date to commence 
drilling, must sink 500 feet the first year and to the depth of 
2000 feet within two years, unless mineral is found at less 'depth. 

At the end of two years if neither oil or gas is found the per- 
mit automatically ends, unless application for extension is made. 

If oil or gas is found the permittee is entitled to become a 
lessee of one fourth of the permitted land, but if the entire tract 
does not exceed 160 acres he is entitled to the whole of it. Sec. 
14. 

If it exceeds 160 acres he has the right to the full fourth of 
the area of the permit. The reference to 160 acres in the first 
proviso of section 14 is confined to small permits of 160 acres 
or less and does not qualify the one-fourth clause. The per- 
mittee has the right to select the particular 160 acres out of 
the full tract which selection must be in compact form. Sec. 14. 

Paragraphs a and b of rule 5 give the details of the monu- 
menting required before a party can apply for a preference 
right. 

Right to Permit. 

When the party applies for a permit the first and perhaps 
the most important question that may arise under the Act is, 
whether or not, if he complies with all the requirements of the 
regulations, he is entitled as of right to such permit or whether 
the department can refuse such permit at its discretion. On 
this point rule 2 says: 

"It should be understood that under the Act, the granting, of 
a prospecting permit for oil and gas is discretionary with the 
Secretary of the Interior, and any application may be granted 
or denied, either in part or in its entirety, as the facts may be 
deemed to warrant." 

With this construction of the Act we cannot agree. The Act 
goes to the limit in its grant of power to the department to make 
rules and regulations to carry out its provisions. These rules 
an applicant complies with strictly and is met with a refusal 
based on a construction which makes it discretionary with the 



318 MORRISON'S OIL RIGHTS 

department to refuse any application whether it complies with 
the regulations or not. 

Of what use are the regulations if when complied with, the 
application for permit is met with a flat refusal to grant it. 
If such is its proper construction there is no need of regula- 
tions, they have no function to perform and the permit should 
issue to any party favored by the department to whom they 
choose to deliver this evidence of a property right without com- 
plying with any precedent conditions. 

Extension of Life of Permit. 

By section 7 of the Regulations it is provided that if for any 
reason the permittee is unable, with the exercise of diligence to 
test the land within two years, application for extension for not 
to exceed two years may be filed within the life of the permit. 
No form is given in the Regulations but the following form with 
such alterations as may be necessary to state the facts should be 
sufficient. 

PETITION FOR EXTENSION OF PERMIT. 

To the Hon. Secretary of the Interior: 

Your petitioner, C. W. Thompson, of 1812 Lawrence St., City 
and County of Denver, State of Colorado, a native born citken 
of the United States, respectfully represents: 

1. That he is the owner of oil and gas permit No. 123 dated 
Oct. 1, 1920 and not yet expired on the Northeast Quarter of 
Section 1, Township 2, South Range 60 West of the 6th P. M. in 
the County of Fremont, State of Colorado. 

2. That under said permit he promptly entered upon said 
premises and diligently prosecuted work on the same and ex- 
pended on such work and in payment for labor, supplies and 
material furnished the same, the sum of .$3,000 all of which has 
been paid for in full. 

3. But that without fault chargeable to your petitioner, he has 
been unable strictly to comply with all the conditions of such 
permit and will not be able to fully comply with such conditions 
during the life of such permit. 

4. That he drilled at a point near the center of the permitted 



PERMIT ON NONPROVEN GROUND 319 

tract to the depth of 500 feet as required by such permit and 
the well so sunk is in good condition for further operations. 

5. That in the further sinking of the well beyond the 500 
feet, at the depth of 575 feet, the work was necessarily stopped 
on or about the 12th day of January 1921 on account of an 
unavoidable accident to the rigvto-wit: by the breaking of the 
rope (or the destruction of the rig by fire, or by the bit be- 
coming fast fixed in the well, or any like accident, or any other 
reason in the way of excuse for noncompliance, according to the 
facts. ) 

WHEREFORE, your petitioner respectfully asks an exten- 
sion of said permit under the terms of section 7 of the Oil Regu- 
lations in circular No. 672 for the further period of two years 
from the date of its expiration. 

C. W. Thompson. 

State of Colorado, 1 

ss. 
City and County of Denver. J 

Before me the subscriber, a Notary Public, in and or said 
City and County of Denver, personally appeared C. W. Thomp- 
son, who being first duly sworn, deposes and says : that he is the 
petitioner named in the foregoing petition and that the mat- 
ters and things stated in said petition are true of his own knowl- 
edge. 

C. W. Thompson. 

Subscribed and sworn to, before me this first day of October, 
A. D. 1922. 

My Commission expires Sept. 26, 1923. 

Frederic A. Fleming, 

Notary Public. 

The above petition must be corroborated by the affidavits of 
one or more persons cognizant of the facts which are stated in 
the petition. 

The inability to secure funds, an accident of only too common 
occurrence, may or may not be a sufficient excuse. It is of course 
no defense to a definite contract to pay money but in matters 



320 MORRISON'S OIL RIGHTS 

addressed to the diseretion of the department or even to a Court 
in Equity it may be valid by way of excuse for failure to per- 
form or delay in performance. 

Where such is the only real excuse available to the permittee 
the facts should be stated in detail with such extenuations as the 
party may be able to add and .should not be stated in general 
terms as a mere conclusion of law. 

Sickness, drought, epidemic, financial panic and what ever is 
included under the collective or generic term "Act of God" may 
be valid excuses in such cases. 

The legal effect of sickness is considered in the notes to Cen- 
tral of Georgia Railway v. Hall, 124 Ga. 322, as reported in 
4 L.R,A.(N.S.) 898. Dickey v. Linscott, 22 Me. 453, 37 Am. 
Dec. 66. 

Failure of crops is good ground for extension of time on pay- 
ment of pre-emption money. In re Brown, 20 L. D. 378. 

Personal accident to the pre-emptor and accidental fire are 
both considered and allowed as excuses in Robinson, in re. 21 L. 
D. 116. 

Loss of crops through failure to secure threshing machine au- 
thorizes an extension of time. In re McGrath, 18 L. D. 52. 

The Lease. 

If within the two years or any extension of the time, oil or 
gas is found in such quantity as makes a lease desirable the per- 
mittee is entitled to it. Rule 8. 

No form for application is prescribed, the only reference to 
it in the rule being that it should be established to the satisfac- 
tion of the Secretary. The application should be by filing in 
the Local L*and Office; in fact all correspondence with the De- 
partment of the Interior, if the procedure long established in 
all sorts of entries is followed, would be commenced in the Local 
Land Office to be forwarded to the General Land Office. 

This lease is the absolute right of the successful permittee, he 
has earned it and cannot be deprived of it without express vio- 
lation of the law. 



PERMIT ON NONPROVEN GROUND 321 

FORM OF APPLICATION FOR LEASE. 

To the Honorable the Secretary of the Interior: 

Your petitioner C. W. Thompson whose Post Office address 
is 1812 Lawrence Street, Denver, Colorado. 

Respectfully represents that he is a citizen of the United 
States and that he is the holder of (or that he is the assignee of 
the holder, giving date of assignment with copy of the same) 

Permit No issued to him on the .... day of 

1920, embracing the North East Quarter of Section 

Township South Range West containing 160 

acres. That upon receipt of such permit he (or that his said as- 
signor) marked and staked the grounds as required by its terms 
and has as he verily believes complied substantially with all the 
requirements of said permit. 

That on or about the day of 1920, at the 

depth of feet in the well which he sank on said per- 
mitted ground he struck oil (or gas, or gas and oil, as the case 

may be stating quantity approximately) yielding about 

barrels per day and he believes that such well should con- 
tinue to produce at about the same rate. 

That he is ready and offers to pay 20 per cent of the value 
of such oil between the date when the well began to produce 
and the date of the filing of this application for lease. 

That he is ready and willing to furnish such other informa- 
tion as the department may reasonably require in the premises. 

Wherefore, petitioner asks that a lease issue to him for said 
160 acres of land on the terms mentioned by the Oil Leasing 
Act and in the form set forth in the regulations of the depart- 
ment. 

C. W. Thompson. 
Verify as on Page 313. 

The form of the lease is given in regulation 17, page 341. 

Pre-emption Right of the Permittee. 

After the permittee has received his lease on the segregated 
one-fourth, the remaining three-fourths are to be advertised for 
competitive bidding, subject to the pre-emption right of the 

M. O. R.— 21. 



3225 MORRISON'S OIL RIGHTS 

lessee of the single one-fourth, such pre-emption or preference 
right apparently amounting to nothing unless the bid of such 
preferred party should be of exactly the same royalty as the 
royalty bid by a stranger. If such third party or stranger bids 
the highest royalty he becomes entitled to the lease. If the 
preferred party is the highest bidder he is entitled to the lease, 
not because of any preference right, but because he is the 
highest bidder. 

The General Land Office has the authority to reject under 
Section 14 and does not seem to be qualified as to its action in 
refusing such bids by any other provisions of the Act. 

If on any tract or tracts no acceptable bid is made there is no 
doubt that they may be reoffered at second auction although the 
readvertisement mentioned in section 36 is confined to auction 
of royalties. 



CHAPTER 67. 

PROCEDURE TO PROCURE LEASE ON THE GEOLOGICAL 

STRUCTURE. 

A party is not allowed to select a piece of land and apply for 
papers on it when it lies within a known geological structure, 
segregated as such in the Local Land Office. 

The department divides such structure into CyLO acre tracts 
or smaller tracts and advertises such tracts for competitive bid- 
ding. 

If the ground on which a lease is desired has not been adver- 
tised for bids there is no doubt that the Secretary of the In- 
terior on request of a reasonable number of responsible parties 
would proceed to throw open that part of the field by the 
necessary publication. 

The practice under Section 17 of the Act which covers this 
class of applications is formulated in rules 13-16, printed on 
pages 339-341. 

The ground is divided into tracts of the size and shape desig- 
nated in said section. 

It is then advertised by public notice in a local newspaper for 
thirtj r days giving the date on which a public auction of such 
lands will be held. Such notice is also posted on the bulletin 
of the local Land Office. 

Before such auction is called for the royalty on each parcel 
has been fixed by the department as also the advance rent, the 
only undetermined factor being the bonus, and the lot or parcel 
goes to the person who offers the highest bonus. 

Rule 15 states what is required of the successful bidder as to 
certified checks, affidavit of citizenship and a special affidavit 
covered by the following form : 

323 



324 MORRISON'S OIL RIGHTS 

AFFIDAVIT OF BIDDER. 

State of Colorado, ) 

City and County of Denver, j 

Before me, the subscriber, a Notary Public in and for said 
city and county personally appeared Charles W. Thompson of 
lawful age, who being first duly sworn, saith that he was the 
highest and best bidder at the auction of oil and gas tracts held 

at , Wyoming on the day of A. D. 

1920 for the North East Quarter (describe land as in form on 
page ). 

That he does not hold any lease in the geologic structure of 
the same producing oil or gas field, nor any permit. 

That the acceptance of the lease by affiant as a successful 
bidder will not be in violation of the provisions of Section 27 
of the Act relative to excess holdings by individuals or cor- 
porations. 

C. W. Thompson. 

Sworn and subscribed before me this .... day of 

A. D. 1920. 

My commission expires September 26, 1923. 

Frederic A. Fleming, 
[seal] Notary Public. 

This affidavit requires modification where the affiant is the 
holder of other leases or permits as referred to in rule 15, sub- 
section b. 

Such showing is then transmitted to the General Land Office 
which will act on the papers and within thirty days either reject 
the bid or mail the triplicate lease for execution with proper 
instructions. 

The form of the lease is the same as used on nonproven 
territory. 

Auction and Bonus. 

Section 17, requiring the oil and gas blocks on the known 
geologic structure to be offered to the highest responsible bidder 



PROCEDURE TO PROCURE 325 

by competitive bidding under general regulations brings in the 
common law of auctions. 

An offer of sale is not one which can be withdrawn after a valid 
bid has been made. The bidder becomes a contracting party as 
soon as the sale is announced by the auctioneer and, having made 
the highest bid, is entitled to the lease just the same as if he 
had a contract in writing for sale of the property at a fixed 
price. 

Of course questions may arise as to who is a responsible bidder 
and whether the sale was properly advertised, but assuming 
everything regular in this respect, the bidder becomes entitled 
to the lease. 

Eules 15 and 16 purport to regulate the auction sale and the 
report of what was done at such sale. 

The bidder must pay a deposit to the local land office by check 
for one fifth of the amount of the bonus and at the same time 
must show his qualification to accept a lease (Rule 15a and b.) 
and the Register and Receiver thereupon report the proceedings 
to the Commissioner of the General Land Office. 

On receipt of such report the Secretary of the Interior takes 
action and will "either award the lease to the successful bidder 
or reject same" (Rule 16) but this phrase undoubtedly means 
that he will act in the premises according to law and will not 
"reject" unless the bidder is in default in some particular in 
the showing required of him. 

The approval of the report is the final act in favor of the 
bidder and he thereupon tenders the advancement and pays the 
balance of the bonus and otherwise complies with the terms of 
Rule 16. 

A Bonus is not a gift but in the nature of a premium. Ken- 
nicott v. Wayne County. 16 Wall. 452, 471. It may be exacted by 
the state as the price of a franchise. Baltimore & 0. B. Co. v. 
Maryland, 21 Wall. 456. In its popular sense it is equivalent 
to "premium" and in the case cited was held to mean "price." 
Leslie v. Leslie, 50 N. J. Eq. 112. 

There is no special meaning to the word bonus otherwise- than 
the common understanding of the term. 



CHAPTER 68. 

LAND OFFICE REGULATIONS. 

/ 

The following are the instructions of the Commissioner of the 
General Land Office issued to carry out the provisions of the 
Leasing Act as expressly authorized by its section 32 and by 
repeated reference in many other of its sections. 

It has been the policy of Congress for a long time to leave 
much of the details of the enforcement of the land laws to the 
Interior Department and of recent years it has devolved such 
duties upon the department to such an extent as to encroach 
seriously on legislative powers which it is conceded cannot be 
rightfully entrusted to or imposed upon it. 

Be that as it may this Oil Leasing Act can neither be under- 
stood nor its benefits secured without constant and close atten- 
tion to the rules printed below as they stand to-day; but they 
are liable to amendments which will undoubtedly be made in 
the form of circulars, copies of which are always furnished on 
request without charge by the local Land Offices. 

These circulars are divided into sections and subsections but 
for convenience and to avoid confusion with the sections of the 
&et, will generally be referred to as "Rule" or "Reg." with the 
proper number. 

In referring to the General Land Office or to the Secretary 
of the Interior the "Department" is used interchangeably for 
either such office or such officer. 

Decisions on the force and effect of Regulations. 

The power of the Department to make and enforce Regula- 
tions for the control of the public domain is at this date unques- 
tionable. (See page 251). It cannot, however, legislate so as to 

326 



LAND OFFICE REGULATIONS 327 

controvert an Act of Congress, and an analysis of the cases 
below cited lead to the general , conclusions : — 

1. That "rules" and "regulations" are practically synonymous. 

2. That either rules or regulations imply a class to be con- 
trolled and not mere instances. 

3. That ordinances and by-laws are more in the nature of 
legislation for municipalities and corporations. 

4. That regulations must be reasonable. 

5. That regulation cannot be enlarged so that it amounts to 
prohibition. 

Where a bank having power to make regulations for the con- 
duct of its business and affairs, makes a by-law attempting to 
give the bank a lien on the stock of its debtors it is not a regula- 
tion under such power. Willard v. Bank, 18 Wall. 589. 

An order made by the Town Trustees establishing the grade 
of a street is a regulation. (But this seems more like an instance 
than a regulation.) Meyer v. Fromm, 108 Ind. 208. 

A regulation is a partial restriction not amounting to a pro- 
hibition. Richards v. Bayonne, 61 N. J. L. 496. 

"The term regulations implies a rule for a general course of 
action. It does not apply to a case in which specific instructions 
are to be given, applicable to that case alone." Christopher v. 
New York, 13 Barb. (N. Y.) 567, 573. 

The word "regulate" has a broad meaning and the power to 
regulate carries with it full power over the thing subject to regu- 
lation. R. R. Comm. v. Kansas City So. Ry. Co., Ill La. 133, 35 
So. 487 ; Durland v. Durland, 74 Pac. 274 (Kans.) . 

Legislation may in many ways affect commerce without con- 
stituting a regulation of it within the meaning of the Constitu- 
tion. Kavanaugh v. So. Ry. Co., 47 S. E. 529 (Ga.). 

Regulations construed as equivalent to rules. Bullion Beck 
M. Co. v. Eureka Hill M. Co. 12 Pac. 660 (Utah). 

A regulation presupposes the existence of a right. To regu- 
late means to adjust, to govern by rule. It is a restriction which 
does not amount to a prohibition. City of Butte v. Paltrovich, 
74 Pac. 521 (Mont.). 

Rules and regulations in a legal sen^c mean laws. The Court 
refused to apply the terms to reach a special act of the Legisla- 



328 MORRISON'S OIL RIGHTS 

ture granting a divorce. Estate of Higbee, in re, 5 Pac. 693 
(Utah). 

Under an act of Congress (R. S. 1869) a writ of error was 
allowed in criminal cases "under such regulations as may be 
prescribed by law." The Court construed these words to mean : 
the rules of law by which this right is to be exercised and that 
the Court and not the party in interest, was to decide upon 
what state of the record a writ of error might issue. Donovan v. 
Territory, 2 Pac. 532 (Wyo.). 

The Montana Constitution gave Appellate jurisdiction to the 
Supreme Court "under such regulations as may be prescribed 
by law." The Court held that this would allow the legislature 
to regulate appeals but in the absence of such legislation the 
Court could adopt rules for itself in place of such legislation. 
The decision was based more upon the inherent power of the 
court than upon construction of the Constitution. Finlen v. 
Heinze, 69 Pac. 829 (Mont.). 

Within the term "regulation" are embraced two ideas. One 
is the mere control of the operation of the road, prescribing the 
rules for its management. Regulations in this sense may be 
considered as purely public. But within the scope of the word 
regulation, is the fixing of rates, which necessarily affects the 
property interests of the Railroad owners, and under the latter 
meaning the court set aside an Act of the Nebraska legislature 
fixing local freights so low that if enforced, there would be no 
net earnings from the entire transportation of the road. Ames 
v. U. P. By., 64 Fed. 165, 178. 

In the Colorado legislation concerning sale of their state lands, 
the phrase of the Constitution "under such regulation as may be 
prescribed by law," Sec. 9 Art. 9, was construed to mean such 
reasonable rules as the legislature may prescribe. Leasing of 
State Lands, in re, 18 Colo. 359. 

A New Jersey Act prohibiting the sale of liquor by small meas- 
ures involved the question of the difference between regulation 
and prohibition. The Court held that the Act was a regulation 
and not a prohibition. The case is reported at great length with 
elaborate arguments, the Court of Appeals being almost evenly 



LAND OFFICE REGULATIONS 329 

divided, 8 to 7. Paul v. Gloucester County, 50 N. J. L. (21 
V room,) 585. 

When a Statute referred to "By-laws, Ordinances, Resolutions, 
and Regulations" to be passed by a City the Court said, "cer- 
tainly there is some distinction in these words in ordinary usage." 
Regulation is the most general of them all, meaning any rule for 
the ordering of affairs public or private. Ordinance refers to 
legislation. Resolution is almost the equivalent of ordinance. 
The Court did not define By-laws which in their modern mean- 
ing are restricted to corporations although historically it is a 
word going back to the Danish Invasions of England referring 
to Towns. Kepner v. Com. 40 Pa. 124. 

Coyler v. Skeffington, 265 Fed. 17, a deportation case is a long 
and interesting case on the procedure where a department acts 
under its regulations instead of under process of law. 

The case shows that their regulations were subject to private 
construction by the department undisclosed to the parties af- 
fected by them and so lost the publicity everywhere essential to 
valid constitutional law. 

In Capa v. United States, 152 U. S. 211, it is held that the 
court takes judicial notice of regulations "for the transaction of 
business" when a department is authorized by Act of Congress to 
prescribe such regulations. But it does not decide that the 
Department can put a private construction before such regula- 
tions, that it can amend them and after an illegal act is done 
under the amendment restore them to the original form as was 
shown to be the practice in the deportation case above noted. 

The Secretary of the Interior may, even without appeal from 
the General Land Office, consider any matter there pending and 
on due opportunity to parties to be heard, correct any errors in 
the decisions of that office. Lake Superior Ship Canal Co. v. 
Patterson, 30 L. D. 161. 

Where power is delegated to the Secretary of a Department 
it is not to be administered arbitrarily and secretly but fairly 
and openly "under the restraints of the tradition and principles 
of free government." So held in a Chinese Exclusion Case. 
Kwock Tan J at v. White, 40 Sup. Ct. Rep. 566. 

See Land Office, page 251. 



330 MORRISON'S OIL RIGHTS 

1 OIL AND GAS REGULATIONS. 

Department of the Interior, 
General Land Office, 
Washingtoii, D. C, March 11, 1920. 
Registers and Receivers, 

United States Land Offices. 
Sirs: Under the authority of the Act of Congress approved 
February 25, 1920, entitled, "An Act to promote the mining of 
coal, phosphate, oil, oil shale, gas, and sodium on the public do- 
main," the following rules and regulations are prescribed for the 
administration of the provisions of said Act relative to oil and 
gas: 

L Oil and Gas Permit. 

Section 13 of the Act authorizes the Secretary of the Interior 
to grant a qualified applicant the exclusive right to prospect for 
oil or gas for the period of two years, unless extended, and under 
authority thereof the following rules and regulations will govern 
the issuance of such permits : 

1. Qualifications of applicants. — Pursuant to section 1 of 
the Act, permits may be issued to (a) a citizen of the United 
States; (b) an association of such citizens; (c) a corporation 
organized under the laws of the United States or of any State 
or Territory thereof, 2 or (d) a municipality. 

2. Lands to which applicable. — The permit thus issued may 
include not more than 2,560 acres of land wherein such deposits 
belong to the United States and are not within any known ge- 
ological structure of a producing oil or gas field, the lands applied 
for to be taken in a reasonably compact form, by legal subdivi- 
sions if surveyed, and in an approximately square or rectangular 

1 This Circular No. 672 issued March 11, 1920, was amended by Circular 
No. 676 dated March 25. 

The amendments are mostly by striking out or modifying certain words 
and clauses. These regulations are printed as they now read since the 
changes with notations as to each amendment. 

2 The amendment struck out the words, "provided that no stockholders 
are citizens of nonreciprocating countries as provided in section 1 of the 
Act." following the word "thereof." 



LAND OFFICE REGULATIONS 331 

tract if unsurveyed, the length of which must not exceed two and 
one-half times its width. 

Such leases may not include land or deposits in (a) national 
parks; (b) forests created under the Act of March 1, 1911 (36 
Stat., 961), known as the Appalachian Forest Reserve Act; (c) 
lands in military or naval reservations; nor (d) Indian reserva- 
tions, or (e) ceded or restored Indian lands, the proceeds from 
the disposition of which are credited to the Indians. 

All permits or leases for the exploration for or development of 
oil or gas deposits under this Act within the limits of national 
forests or other reservations or withdrawals to which this Act is 
applicable shall be subject to and contain such conditions, stipu- 
lations and reservations as the Secretary of the Interior shall 
deem necessary for the protection of such forests, reservations 
or withdrawals, and the uses and purposes for which created. 

The boundaries of the geological structures of producing oil 
or gas fields will be determined by the United States Geological 
Survey, under the supervision of the Secretary of the Interior, 
and maps or diagrams showing same will be placed on file in local 
United States Land Offices. 

It should be understood that under the Act, the granting of a 
prospecting permit for oil and gas is discretionary with the Sec- 
retary of the Interior, and any application may be granted or 
denied, either in part or in its entirety, as the facts may be 
deemed to warrant. 

3. Permits or leases for other minerals. — The granting of 
a permit or lease for the development or production of oil or gas 
will not preclude other permits or leases of the same land for the 
mining of other minerals, under this Act, with suitable stipula- 
tions for such joint»operation, to the end that the full develop 
ment of the mineral resources may be secured, nor will it pre- 
clude the allowance of applicable entries, locations, or selections 
of the lands included therein with a reservation of the mineral 
deposits to the United States. 

4. Form anj> contents of application. —Applications for per- 
mits should be filed in the proper district land office, addressed 
to the Commissioner of the General Land Office, be suspended 
for 30 days to enable preference-right claims to be presented 



♦32 MORRISON'S OIL RIGHTS 

before action, and after due notation then forwarded for his con- 
sideration, with a full report as to status and conflicts. No spe- 
cific form of application is required, and no blanks wlil be 
furnished, but it should cover, in substance, the following points, 
and be under oath : 

(«) Applicant's name and address. 

( b ) Proof of citizenship of applicant, by affidavit of such fact, 
if native born ; or if naturalized, by a certified copy of the certif- 
icate of naturalization on the form provided for use in publie- 
land matters, unless such a copy is already on file ; if a corpora- 
tion, by certified copy of the articles of incorporation, *and a 
showing as to the residence and citizenship of its stockholders.* 3 
If a municipality, a showing of (1) the law or charter and 
procedure taken by which it has become a legal body corporate ,• 
(2) that the taking of a permit or lease is authorized under such 
Jaw or charter; and (3) that the action proposed has been duly 
authorized by the governing body of such municipality. 4 

"(c) A statement that the applicant is not the holder of more 
than two other subsisting permits in the same State, nor of any 
permit in the same^geologic structure, together with a statement 
of any other applications for permits in the same State, in which 
the applicant is directly or indirectly interested. In this connec- 
tion attention is directed to the limitations and exceptions of 
Section 27 of the Act." 

(d) Description of the land for which the permit is desired, 
by legal subdivisions if surveyed, and by metes and bounds if 
unsurveyed, in which latter case, if deemed necessary, a survey 
sufficient more fully to identify the land may be required before 
the permit is granted. In order to properly identify unsurveyed 
lands, great care should be taken, and if possible the metes and 

3 Instead of the words between the * * the rule before amendment 
read: 

"and evidence that none of its stockholders are citizens of another coun- 
try, the laws, customs, and regulations of which deny similar or like 
privileges to citizens or corporations of this country;" 

4 Paragraph c before amendment read: 

(c) A statement that the applicant is not the holder of, and has no 
direct or indirect interest in, any other subsisting permit, and that he 
has no other application pending for a permit. 



•land office regulations 333 

bounds description should be connected by course and distance 
with some corner of the public land surveys. 

(e) Reasons why the land is believed to offer a favorable field 
for prospecting, together with the statement that to the best of 
applicant's knowledge and belief the land applied for is not with 
in any known geological structure of a producing oil or gas field. 

Q0 Proposed method of conducting exploratoiy operations, 
which must be in accordance with approved methods of cxplora 
tion, amount of capital available for such operations, and the 
diligence with which such explorations will be prosecuted. 

(g) Statement of the applicant's experience in operations of 
this nature, together with references as to his reputation and 
business standing. 

hi If the applicant is claiming a preference right as ex- 
plained in the next succeeding section of these regulations, he 
should set up fully the facts upon which such preference right 
is based, together with a true copy of the posted notice. 

(i) The application must be accompanied by a bond with qual- 
ified corporate surety, in the sum of $1,000, conditioned against 
the failure of the permittee to repair promptly, so far as possible, 
any damage to the oil strata or deposits resulting from improper 
methods of operation. The penalty of the bond may be increased 
by the Secretary of the Interior when conditions warrant, par- 
ticularly in relief cases. 

5. Preference right, how secured.— A preference right oyer 
others to a permit may be obtained, under section 13 of the Act. 

by- 

(a) Erecting upon the land desired, subsequent to the ap- 
proval of the Act, a monument not less than 4 feet high, at some 
conspicuous place thereon, of such a size as to be visible to any- 
one who may be interested. The monument may be of iron, 
stone, or durable wood, not less than 4 inches square or in dia- 
meter, and must be firmly imbedded in the ground. 

(b) Posting on or near said monument a notice stating that 
an application for permit will be made within thirty days after 
date of posting said notice, the notice to give the date and hour 
of posting, to be signed by the applicant, and give such a general 
description of the land to be covered by the permit, by reference 



334 MORRISON'S OIL RIGHTS * 

to courses and distances from such monument and other natural 
objects and permanent monuments, as will reasonably identify 
the land. The area, approximately, must also be stated, and the 
notice must be so protected as to prevent its destruction by the 
elements. The preference right will exist for thirty days after 
the date of posting such notice, and if no application is filed 
within that time, the land will be subject to any other applica- 
tion for permit or to other disposal. 

(c) In cases of conflict between a preference right application, 
and one filed without any claim of preference, the priority of the 
initiation of the claim will govern, for example, the filing of a 
proper application in the Land Office prior to the posting of no- 
tice by another, as aforesaid, will give a prior right. 

6. Form and requirements of permit. — A permit will confer 
upon the recipient the exclusive right to prospect for oil or gas 
upon the lands embraced therein, provided he complies with the 
terms thereof, which permit will be, in form and substance, 
substantially as follows : 

FORM OF PERMIT. 

The United States of America, 
department of the interior. 



General Land Office. 



U. S. Land Office, 
Serial Number, 



Know all men by these presents, That the Secretary of the 
Interior, under and by virtue of the Act of Congress entitled, 
"An Act to promote the mining of coal, phosphate, oil, oil shale, 
gas, and sodium on the public domain," 'approved February 25, 

1920, has granted and does hereby grant a permit to 

granting the exclusive right for years 

from date hereof to prospect for oil or gas, but for no other pur- 
pose, the following described lands : , upon the ex- 
press conditions following : 



LAND OFFICE REGULATIONS 335 

1. To mark each of the corners of the claim within ninety 
days from date hereof with substantial monuments so that the 
boundaries can be readily traced on the ground, and post in a 
conspicuous place, upon the lands covered hereby, a notice that 
such a permit has been granted, and a description of the lands 
covered by this permit. 

2. Within six months (two years in Alaska) from date hereof 
to install upon some portion of the lands a substantial 
and adequate drilling outfit and to commence actual drilling 
operations. 

3. Within one year (three years in Alaska) from date hereof 
to drill one or more wells, not less than 6 inches in diameter to a 
depth of at least 500 feet each, unless valuable deposits of oil 
or gas shall be sooner discovered. 

4. Within two years (four years in Alaska) from date hereof 
to drill one or more wells to a depth of at least 2,000 feet, unless 
valuable deposits of oil or gas shall be sooner discovered. 

5. Not to drill any well within 200 feet of any of the outer 
boundaries of the lands covered by this permit unless the ad- 
joining lands have been patented or the title thereto otherwise 
vested in private owners. 

6. To carry on all operations hereunder in accordance with 
approved methods and practice; to use all reasonable precau- 
tions to prevent waste of oil or gas developed in the land, or the 
entrance of water through wells drilled by permittee to the oil 
sands or oil-bearing strata to the destruction or injury of the 
oil deposits, and to carry out, at the expense of the permittee, 
all reasonable orders of the Secretary of the Interior relative to 
prevention of waste and preservation of property, and to comply 
with such regulations as may be issued by the Secretary of the 
Interior as to methods of operation. 

7. To furnish and maintain during the period of this permit a 
bond with qualified corporate surety, in the sum of $ , con- 
ditioned against the failure of the permittee to repair promptly, 
so far as possible, any damage to the oil strata or deposits re- 
sulting from improper methods of operation. 

8. That this permit is granted upon the express condition that 
the right is reserved to the Secretary of the Interior to permit 



336 MORRISON'S OIL RIGHTS 

upon such terms as he may determine to be just, for joint or 
several use, such easements or rights of way, including easements 
in tunnels upon, through, or in the lands covered hereby, as may 
be necessary or appropriate to the working of the same, or of 
other lands containing the deposits described in the act under 
which this permit is granted. 

9. The granting of this permit shall not preclude the allowance 
of entry, location, or selection of any of the lands included there- 
in, where such entry, selection, or location is made with a reserva- 
tion of the mineral deposits to the United States. 

10. That until this permittee shall apply for a lease to one- 
quarter or more of the area included herein, he shall pay to the 
United States 20 per cent of the gross value of all oil or gas se- 
cured by him from the lands and sold or otherwise disposed of, 
or held by him for sale or other disposition. 

11. The Secretary of the Interior reserves the right and au- 
thority to cancel this instrument for failure of the permittee to 
comply with any of the conditions enumerated herein or to exer- 
cise due diligence in the work of development. 

Valid rights existing at the date of this permit will not be af- 
fected thereby. 

Dated this day of 19 .... . 



Secretary of the Interior, 

7. Extension of life of permit. — If for any good reason the 
permittee is unable, with the exercise of diligence, to test the 
land within two years, application for extension for not to exceed 
two years may be filed within the life of the permit, and must be 
accompanied by a showing under oath, corroborated, as to the 
causes that make such extension necessary, and as to what efforts 
have been made to comply with the condition of the permit ; or- 
dinarily no extension will be granted in the absence of the mini- 
mum amount of drilling required by the permit. This applica- 
tion should be addressed to the Secretary of the Interior, and be 
tiled either in the district land office or in the General Land Of- 
fice. This privilege is not applicable to Alaska. 

8. Reward for discovery. — Upon establishing to the satisfac- 



LAND OFFICE REGULATIONS 337 

tion of the Secretary of the Interior that valuable deposits of oil 
or gas have been discovered within the limits of the land em- 
braced in the permit, within the period of the permit or extension 
thereof, the permittee is entitled (a) to a lease of one-fourth of 
the land included in the permit, on a royalty of 5 per cent, or 
for at least 160 acres if there be that area in the permit; (6) to 
a preference right to a lease for the remainder of the land cov- 
ered by his permit at such royalty as may be fixed by the Secre- 
tary of the Interior, not less than 12| per cent in amount or value 
of the production, or the Secretary may, in his discretion, offer 
said land for lease at a royalty to be determined by competitive 
bidding, the preference right claimant to have the refusal of a 
lease at a royalty equivalent to that offered by the highest re- 
sponsible bidder. 

9. Penalty for default. — The permit will be subject to can 
cellation by the Secretary of the Interior for failure of the per- 
mittee to comply with any of the conditions enumerated therein 
or to exercise due diligence in the work of development. 

In the absence of discovery of oil or gas within the period of 
the permit, or extension thereof, the permit will thereupon ter- 
minate and the lands or deposits will automatically revert to 
their original status, but the land will continue segregated pend 
ing action by the Land Department on any application for ex 
tension that is timely filed. 

10. Permits in Alaska. — The foregoing rules and regulations 
generally will apply to permits in Alaska, under section 13 of 
the Act, but with some modifications, viz : • 

(a) A person, association, or corporation is authorized to hold 
five permits at one time in said territory, and subdivision (c) of 
section 4 of these regulations is not applicable. The applicant 
must show, in lieu thereof, that he does not hold an interest in 
more than four permits or leases in Alaska. 

(b) The preference right treated under section 5 of these regu- 
lations extends for a period of six months after the erection of 
monument and posting of .notice provided for therein, and the 
period for marking of the corners is extended to one year after 
the granting of the permit. 

(c) The time for exploratory work in Alaska is four years, in- 

M. 0. R.— 22. 



338 MORRISON'S OIL RIGHTS 

stead of two, and there is no provision for extension of such peri- 
od. The various items necessary in this exploratory work are set 
forth in the form of permit herein provided, the Alaskan period 
being included in parentheses, after the period prescribed in the 
States. 

11. Permits for reserved deposits. — The deposits of oil and 
gas in all lands for which a patent has issued with a reservation 
of the oil and gas to the United States, subject to the preference 
right, if any, explained in the next succeeding section hereof, 
may be included in a permit under the provisions of this Act, 
conditioned upon the permittee filing with the Secretary of the 
Interior a satisfactory bond or undertaking as security for the 
payment of all damages to crops and improvements on such lands 
by reason of prospecting, as required by the Act of July 17, 
1914 (38 Stat., 509). 5 

12. Preference right to owner of surface. — A preference 
right to a permit is given to an owner or entryman of the land 
with a reservation of the oil deposits to the United States, under 
the following conditions: (a) The land must have been with- 
drawn or classified as oil or gas lands ; ( b ) entry must have been 
bona fide and made prior to such withdrawal or classification, 
and prior to the date of the Act; (c) in case of an assignment, 
same must have been prior to January 1, 1918; (d) the land 
must not be claimed under any railroad grant. 

(a) Should an application for permit for such lands be filed 
by a person other than the owner of the land, the applicant will 
be required to serve personal notice of such application upon the 
owner or owners of the land so patented, with a warning therein 
that if said owner desires to exercise his preference right, if any, 
to a permit, he must file within thirty days his application there- 

5 This first paragraph of sec. 12 as issued March 11, read: 
12. Preference right to owner of surface. — A preference right to a 
permit is given to an owner of the land with a reservation of the oil 
deposits to the United States, under the following conditions: (a) The 
land must have been withdrawn or classified as oil or gas lands; (6) entry 
must have been bona fide and made prior to such withdrawal or classifica- 
tion; (c) land must have been patented prior to the date of the Act with 
a mineral reservation to the United States; {d) in case of an assignment, 
the land must have been transferred or assigned prior to January 1, 1918. 



LAND OFFICE REGULATIONS 339 

for in the proper local Land Office. The applicant must furnish 
evidence of the service of notice on the owner and evidence that 
the party served is the owner of the land involved, either by his 
affidavit, duly corroborated, or by certificate of the officer in 
whose office transfers of real property are to be recorded. 

(6) The preference-right applicant must show that he is en- 
titled under the section above outlined, together with his quali- 
fications to hold a permit as previously set forth in these regula- 
tions, and if such an application be filed, the Secretary of the 
Interior will award the permit to the party entitled thereto. 

(c) The preference right of those owning lands coming within 
the provisions hereof will exist until exercised by the claimant 
or until an adverse application has been filed, due notice given 
in accordance with these regulations, and the permit awarded to 
one or the other of the applicants. 

(d) Any claimants to lands of this character may combine 
their holdings for the purpose of making joint application for a 
permit, provided the aggregate area does not exceed 2,560 acres 
and that all the lands for which application is made are within 
an area of 6 miles square, or within the same township. 

(e). The right of a permittee under a preference-right permit 
to a lease after discovery is governed by other provisions of the 
Act, as set forth in section 8 of these regulations. 

II. Oil and Gas Leases. 

13. Designation and offer of lands for lease. — Pursuant to 
the provisions of section 17 of the Act, the unappropriated de- 
posits of oil or gas situated within known geologic structures of 
producing oil or gas fields, and the lands containing same, will 
be divided into leasing blocks or tracts in areas not exceeding 
640 acres each, and not exceeding in length two and one-half 
times their width, and offered for lease at a stated royalty by 
competitive bidding to the highest responsible bidder having the 
qualifications prescribed by section 15, paragraph (a), hereof. 

14. Notice of lease offer. — Notice of the offer of lands for 
lease will be given by publication in a newspaper of general cir- 
culation in the county in which the lands or deposits are situated 
for a period of thirty days; such notice will state the day and 



340 MORRISON'S OIL RIGHTS 

hour on which the offering will be made at public auction at the 
United States Land Office of the district in which the lands are 
situated, to the qualified bidder offering the highest bonus for 
the lease at the stated rental and royalty. Copy of the notice 
will be posted in said local office during the period of publica- 
tion. This notice will be published at the expense of the govern- 
ment. All bidders at any such auction are warned against vio- 
lation of the provisions of section 59 of the United States 
Criminal Code, approved March 4, 1909, prohibiting unlawful 
combination or intimidation of bidders. 

15. Auction of lease. — At the time fixed in the notice, the 
register or receiver will, by public auction, offer the land for lease 
on the terms and conditions as to payments of royalties and rents 
fixed in the notice, to the qualified bidder of the highest amount 
offered as a bonus for the privilege of leasing the land. The 
successful bidder must deposit with the receiver on the date of 
the sale, certified check on a solvent bank, or cash, for one-fifth 
the amount bid by him, which payment the receiver will credit 
to "Trust funds — Unearned moneys." At the time of such pay- 
ment, the successful bidder will also file the requisite showing of 
his qualifications to receive a lease, which shall include the fol- 
lowing : 

(a) Proof of citizenship of applicant; by affidavit of such 
fact, if native born, or if naturalized, by certified copy of the 
certificate of naturalization, on the form provided for use in 
public land matters, unless such copy is already on file ; if a cor- 
poration, by certified copy of the articles of incorporation "and 
a showing as to the residence and citizenship of its stockhold- 
ers." 6 

(6) The affidavit of the bidder or the affidavit of one of the 
officers of a corporate bidder that the bidder does not hold an- 
other lease in the geologic structure of the same producing oil or 
gas field, nor more than two leases, or a lease and a permit, in the 

6 Instead of the words "and a showing as to the residence and citizen- 
ship of its stockholders" the original read: 

"and evidence that none of its stockholders are citizens of another country, 
the laws, customs, and regulations of which deny similar or like privi- 
leges to citizens or corporations of this country." 



LAND OFFICE REGULATIONS 341 

State, except under sections 18, 18a, 19, and 22 of the Act, and 
also that the acceptance of the lease by such successful bidder 
will not be in violation of the provisions of section 27 of the Act 
relative to excess holdings by individuals or corporations. 

The register and receiver will thereupon transmit such show- 
ing, together with a report of the proceedings had at the auction, 
by special letter to the Commissioner of the General Land Office. 

16. Award of lease. — On receipt of the report of the auction 
from the register and receiver, the Secretary of the Interior will 
take action thereon, and either award the lease to the successful 
bidder or reject same, notice of which will be forthwith trans- 
mitted to the bidder through the local office. If the lease shall 
be awarded, the notice will be accompanied by copies of leases 
for execution by the lessee, who shall, within thirty days from 
receipt of such notice, execute said lease in triplicate, and pay to 
the receiver the balance of the bonus bid by him, together with 
the first year's rental, and als'o cause to be filed in the Land 
Office the bond required by Section 2 (a) of the lease; in lieu 
of such bond, Liberty bonds will be taken at par in the amount 
of the bond, as provided in the Act of February 24, 1919 (40 
Stat., 1148). If the bid be rejected, the receiver will return, by 
his official cheek, the deposit made at the auction. In case of the 
award of a lease and failure on the part of the bidder to execute 
same, and otherwise comply with the applicable regulations, the 
deposit made will be considered forfeited and disposed of as other 
receipts under this Act. 

17. Form of lease. — The lease referred to in the preceding 
sections will be in form and substance, substantially as follows: 

FORM OF OIL AND GAS LEASE. 



U. S. Land Office 
Serial No. 



Department of the Interior. 
Lease of oil and gas lands under the Act of February 25, 1920. 

Date — Parties. — This indenture of lease entered into, in tripli- 
cate, this day of a. d. 19. . , ., by and between the 



342 MORRISON'S OIL RIGHTS 

United States of America, acting in this behalf by the Secretary 
of the Interior, party of the first part, hereinafter called the 

lessor, and of , party of the second 

part, hereinafter called the lessee, under, pursuant, and subject 
to the terms and provisions of the Act of Congress approved 
February 25, 1920, Public No. 146, entitled "An Act to promote 
the mining of coal, phosphate, oil, oil shale, gas, and sodium on 
the public domain," hereinafter referred to as the Act, which 
is made a part hereof, witnesseth : 

Section 1. Purposes. — That the lessor in consideration of rents 
and royalties to be paid, and the covenants to be observed as here- 
in set forth, does hereby grant and lease to the lessee the ex- 
clusive right and privilege to drill for, mine, extract, remove, 
and dispose of all the oil and gas deposits in or under the follow- 
ing described tracts of land situated in the county of . . .- , 

State of , and more particularly described as fol- 
lows : containing . *. . . acres, more or less, together 

with the right to construct and maintain thereupon all works, 
buildings, plants, waterways, roads, telegraph or telephone lines, 
pipe lines, reservoirs, tanks, pumping stations, or other struc- 
tures necessary to the full enjoyment hereof, for a period of 
20 years, with the preferential right in the lessee to renew this 
lease for successive periods of 10 years, upon such reasonable 
terms and conditions as may be prescribed by the lessor, unless 
otherwise provided by law at the time of the expiration of such 
periods. 

Sec. 2. In consideration of the foregoing, the lessee hereby 
agrees : 

(a) Bond. — To furnish a bond with approved corporate sure- 
ty in the penal sum of $5,000, conditioned upon compliance with 
the terms of the lease. 

(b) Commence drilling. — The lessee agrees, within three 
months from delivery of executed lease, to proceed with reason- 
able diligence to install on the leased ground a standard or other 
efficient drilling outfit and equipment, and to commence drilling 
at least one well, and to continue such drilling with reasonable 
diligence to production, or to a point where the well is demon 
strated unsuccessful, and thereafter to continue drillhig with rea- 



LAND OFFICE REGULATIONS 343 

sonable diligence at least one well at a time until the lessee shall 
have drilled wells equal in number to the number of forty-acre 
tracts embraced in the leased premises, unless the lessor shall, 
for any reason deemed sufficient, consent in writing to the drill- 
ing of a less number of wells ; the lessee further agrees to drill 
all necessary wells fairly to offset the wells of others on adjoin- 
ing land or deposits not the property of the United States. 

(c) Royalty and rents. — To pay the lessor in advance, begin- 
ning with the date of the execution of this lease, a rental of one 
dollar per acre per annum during the continuance hereof, the 
rental so paid for any one year to be credited on the royalty for 

that year, and, in addition to such rental, a royalty of per 

cent of the value of oil or gas produced from the land leased here- 
in (except oil or gas used for production purposes on said lands 

or unavoidably lost), or, on demand of the lessor, per cent 

of the oil or gas produced (except oil or gas used for production 
purposes on said lands, or unavoidably lost), in which case credit 
for rent shall be on the basis of the current field price of oil, the 
royalty, when paid in value, to be due and payable monthly on 
the 15th of each month following the month in which produced, 
to the receiver of public moneys of the proper land district ; and 
when paid in kind, to be delivered in the field where produced 
at such times, and in such manner as may be required by the 
lessor ; such royalties, whether in value or kind, shall be subject 
to reduction whenever the average daily production of any oil 
well shall not exceed ten barrels per day, if in the judgment 
of the lessor the wells can not be successfully operated upon 
the royalties fixed herein. 

"(d) Sales contract. — To file with the Secretary of the Inte- 
rior copies of all sales contracts for the disposition of oil and gas 
produced hereunder except for production purposes on the land 
leased, and in the event the United States shall elect to take its 
royalties in money instead of in oil or gas, not to sell or otherwise 
dispose of the products of the land leased except in accordances 
with a sales contract or other method first approved by the Sec- 
retary of the Interior. 7 

1 This paragraph d before amendment read: 
(d) Soles contract. — Not to sell or otherwise dispose of any of the oil 



•>44 MORRISON'S OIL RIGHTS 

(e) Monthly statement. — To furnish monthly statements in 
detail in such form as may be prescribed by the lessor, showing 
the amount and value of all oil and gas produced and saved 
during the preceding calendar month as the basis for computing 
the royalty due the lessor. The leased premises and all wells, 
improvements, machinery, and fixtures thereon or connected 
therewith and all books and accounts of the lessee shall be open 
at all times for the inspection of any duly authorized officer of 
the department. 

"(/) Plats and reports. — To furnish annually and at such 
other times as the Secretary shall require, in the manner and 
form prescribed by the Secretary of the Interior, a plat showing 
all development work and improvements on the leased lands, 
and other related information, with a report as to all buildings, 
structures, or other works placed in or upon said leased lands, 
accompanied by a report in detail as to the stockholders, invest- 
ment, depreciation. 8 

(g) Log of ivells. — To keep a log in the form prescribed by 
the Secretaiy of all the wells drilled by the lessee, showing the 
strata and character of the ground passed through by the drill, 
which log, or copy thereof, shall be furnished to said lessor on 
demand. 

(h) Diligence — Prevention of waste — Health and safety of 
workmen. — To exercise reasonable diligence in drilling and op- 
erating wells for the oil and gas on the lands covered hereby, 
while such products can be secured in paying quantities, unless 

or gas produced hereunder, except for production purposes on the land 
leased, other than under and in accordance with a sales contract or other 
method, that shall first be approved by the Secretary of the Interior. 

8 Paragraph / first read: 

(/) Plats and reports. — To furnish annually, and at such other time as 
the Secretary shall require, in the manner and form prescribed by the 
Secretary of the Interior, a plat showing all development work and im- 
provements on the leased lands, and other related information, with a re- 
port as to all buildings, structures, or other works placed in or upon said 
leased lands, accompanied by a report in detail as to the stockholders, 
business transacted, investment, depreciation, cost of operation, assets, 
end liabilities of the lessee, together with a statement as to the amount 
and grade of oil and gas produced and sold, amount received therefor, and 
the amount in storage by operations hereunder. 



LAND OFFICE REGULATIONS 345 

consent to suspend operations temporarily is granted by the Sec- 
retary of the Interior; to carry on all operations hereunder in 
a good and workmanlike manner in accordance with approved 
methods and practice, having due regard for the prevention of 
waste of oil or gas developed on the land, or the entrance of 
water through wells drilled by the lessee to the oil sands or oil- 
bearing strata to the destruction or injury of the oil deposits, the 
preservation and conservation of the property for future pro- 
ductive operations, and to the health and safety of workmen and 
employees ; to plug securely any well before abandoning the samo 
so as to effectually shut off all water from the oil or gas bearing 
strata ; not to drill any well within 200 feet of any of the outer 
boundaries of the lands covered hereby, unless the adjoining 
lands have been patented or the title thereto otherwise vested in 
private owners ; to conduct all mining, drilling, and related pro- 
ductive operations subject to the inspection of the lessor; to carry 
out at expense of the lessee all reasonable orders and require- 
ments of lessor relative to prevention of waste, and preservation- 
of the property and the health and safety of workmen, and on 
failure so to do the lessor shall have the right to enter on the 
property to repair damage or prevent waste at the lessee's cost ; 
to abide by and conform to regulations in force at the time 
the lease is granted covering the matters referred to in this; 
paragraph. 

(i) Taxes and wages — Freedom of purchase. — To pay wheu 
due, all taxes lawfully assessed and levied under the laws of the 
State upon improvements, oil, and gas produced from the lands 
hereunder, or other rights, property, or assets of the lessee; to 
accord all workmen and employees complete freedom of pur- 
chase, and to pay all wages due workmen and employees at lea^t 
twice each month in the lawful money of the United States. 

(j) Reserved deposits. — To comply with all statutory require 
ments and regulations thereunder, if the lands embraced herein 
have been or shall hereafter be disposecTof under laws reserving 
to the United States the deposits of oil and gas therein, subject 
to such conditions as are or may hereafter be provided by the 
laws reserving such oil or gas. 

(k) Excess holdings. — To observe faithfully the provisions of 



346 MORRISON'S OIL RIGHTS 

section 27 of the Act defining the interest or interests that may 
be taken, held, or exercised under leases authorized by said Act. 

(I) Assignment of lease. — Not to assign this lease or any in- 
terest therein, nor sublet any portion of the leased premises, ex- 
cept with the consent in writing of the Secretary of the Interior 
first had and obtained. 

(m) Deliver premises in case of forfeiture. — To deliver up the 
premises leased, with all permanent improvements thereon, in 
good order and condition in case of forfeiture of this lease. 

Sec. 3. The lessor expressly reserves: 

(a) Bights reserved — Easements and rights of way. — The 
right to permit for joint or several use such easements or rights 
of way, including easements in tunnels upon, through, or in the 
lands leased, occupied, or used as may be necessary or appropri- 
ate to the working of the same or of other lands containing the 
deposits described in said Act, and the treatment and shipment 
of products thereof by or under authority of the government, its 
lessees or permittees, and for other public purposes. 

(b) Disposition of surface. — The right to lease, sell, or other- 
wise dispose of the surface of the lands embraced within this 
lease under existing law or laws hereafter enacted in so far as 
said surface is not necessary for the use of the lessee in the ex- 
traction and removal of the oil and gas therein. 

(c) Pipe lines to convey at reasonable rates. — The right to 
require the lessee, his assignee, or beneficiary, if owner, or oper- 
ator, or owner of a controlling interest in any pipe line, or any 
company operating the same which may be operated accessible 
to the oil derived from lands under such lease, to accept and 
convey at reasonable rates and without discrimination the oil of 
the government or of any citizen or company, not the owner of 
any pipe line, operating a lease or purchasing oil or gas under 
the provisions of this Act. 

(d) Monopoly and fair prices. — Full power and authority to 
carry out and enforce all the provisions of Section 30 of the Act, 
to insure the sale of the production of such leased lands to the 
United States and to the public at reasonable prices, to prevent 
monopoly, and to safeguard the public welfare. 

(e) Helium. — Pursuant to Section 1 of the Act, the lessor re- 



IiAND OFFICE KEGUEATIOZS' S 347 

serves the right to take all helium from any gas produced under 
this lease* but the lessee shall not be required to extract and save 
the helium for the lessor; in case the lessor elects to take the 
helium, the lessee shall deliver all gas containing same, or portion 
thereof desired, to the lessor in the manner required by the lessor, 
for the extraction of the helium in such plant or reduction works 
for that purpose as the lessor may provide, whereupon the residue 
shall be returned to the lessee with no substantial delay in the 
delivery of gas produced from the well to the purchaser thereof ; 
provided, that the lessee shall not, as a result of the operation in 
this section provided for, suffer a diminution in value of the 
gas from which the helium has been extracted, or loss otherwise, 
for which the lessee is not reasonably compensated, save for the 
value of the helium extracted; the lessor further reserves the 
right to erect, maintain, and operate any and all reduction works 
and other equipment necessary for the extraction of helium on 
the premises leased. 

Sec. 4. Surrender and termination of lease. — The lessee may, 
on consent of the Secretary of the Interior first had and obtained 
m writing, surrender and terminate this lease upon the payment 
of all rents, royalties, and other obligations due and payable to 
the lessor, and upon payment of all wages and moneys due and 
payable to the workmen employed by the lessee, and upon a satis- 
factory showing to the Secretary that the public interest will not 
be impaired; but in no case shall such termination be effective 
until the lessee shall have made full provision for conservation 
and protection of the property; upon like consent had and ob- 
tained the lessee may surrender any legal subdivisions of the 
area included herein. 

Sec. 5. Purchase of materials, etc., on termination of lease. — 
Upon the expiration of this lease, or the earlier termination there- 
of pursuant to the last preceding section, the lessor or another 
Lessee may, if the lessor shall so elect within six months from the 
termination of the lease, purchase all materials, tools, machinery, 
appliances, structui'es, and equipment placed in or upon the land 
by the lessee, on the payment to the lessee of such sum as may be 
fixed as a reasonable price therefor by a board of three apprais- 
ers, one of whom shall be chosen by the lessor, one by the lessee, 



848 MORRISON'S OIL RIGHTS 

and the other by the two so chosen; pending such election all 
equipment shall remain in normal position. If the lessor, or an- 
other lessee, shall not, within six months, elect to purchase all of 
such materials, tools, machinery, appliances, structures, and 
equipment, or shall elect to purchase only a part thereof, the 
lessee shall have the right at any time within ninety days to 
remove from the premises herein all of the said materials, tools, 
machinery, appliances, structures, and equipment, or such part 
thereof as the lessor, or other lessee, may not have elected to 
purchase, save and except casing in wells and other equipment 
or apparatus necessary for the preservation of the well or wells. 

Sec. 6. Judicial proceedings in case of default. — If the lessee 
shall fail to comply with the provisions of the Act, or make 
default in the performance or observance of any of the terms, 
covenants, and stipulations hereof, or of the general regulations 
promulgated and in force at the date hereof, and such default 
shall continue after service of written notice thereof by the les- 
sor, then the lessor may institute appropriate judicial proceed- 
ings for the forfeiture and cancellation of this lease in accord- 
ance with the provisions of Section 31 of said Act; but this 
provision shall not be construed to prevent the exercise by the 
lessor of any legal or equitable remedy which the lessor might 
otherwise have. A waiver of any particular cause of forfeiture 
shall not prevent the cancellation and forfeiture of this lease for 
any other cause of forfeiture, or for the same cause occurring at 
any other time. 

Sec. 7. Heirs and successors in interest. — It is further cove- 
nanted and agreed that each obligation hereunder shall extend 
to and be binding upon, and every benefit hereof shall inure to, 
the heirs, executors, administrators, successors, or assigns of the 
respective parties hereto. 

Sec. 8. Unlawful interest. — It is also further agreed that no 
Member of, or Delegate to Congress, or Resident Commissioner, 
after his election or appointment, or either before or after he has 
qualified, and during his continuance in office, and that no officer, 
agent, or employee of the Department of the Interior shall be 
admitted to any share or part in this lease or derive any benefit 
that may arise therefrom, and the provisions of Section 3741 of 



LAND OFFICE REGULATIONS 349 

the Revised Statutes of the United States, and sections 114, 115/ 
and 116 of the Codification of the Penal Laws of the United 
States approved March 4, 1909 (35 Stat., 1109), relating to con- 
tracts enter into and form a part of this lease so far as the same 
may be applicable. 
In witness whereof 

The United States of America, 

By [l. s.] 

Witness : 

[l.s.] 

[fc s.] 

[l.s.] 

III. Relief Measures. 

Sections 18, 19, and 22 of the Act provide for the "relief," 
so-called, of certain defined claimants of oil and gas lands, who 
at date of the Act had not perfected their claims under the pre- 
existing mining laws, and are prevented from doing so by with- 
drawal of the land or by this Act. 

18. Conditions for relief under section 18: 

(a) That the land claimed must have been included in the 
executive order of withdrawal of September 27, 1909, and must 
have remained so withdrawn. 

( b ) That the claim must have been initiated under the placer 
mining laws prior to July 3, 1910, and claimed and possessed 
continuously from that time. 

"(c) That no claimant who has acquired any interest in the 
land since September 1, 1919, from another claimant who, on 
that date or since that time, was or is claiming or holding more 
than the maximum allowed a claimant under section 18 of the 
Act, may secure a lease under section 18, or any interest therein. 
This limitation does not, however, apply to an exchange of an 
interest in such lands made prior to January 1, 1920, which did 
not increase or reduce the area or acreage held or claimed in ex- 
cess of the maximum by either party to the exchange." 9 

9 Paragraph c before substitution read: 

(c) That claimant's interest in the land must have been acquired prior 
to September 1, 1919, except lands acquired by exchanges made prior to 



350 MORRISON'S OIL RIGHTS 

(d) That claimant or predecessors must have drilled an oil 
or gas well on the land to discovery. 

(e) That all conflicting claims 10 asserted prior to July 1, 1919, 
must have been disposed of, as provided in section 28 hereof or 
otherwise. 

(/) That no claimant who has been guilty of any fraud or 
who had knowledge or reasonable grounds to know of any fraud, 
or who has not acted honestly and in good faith, shall be en- 
titled to any of the benefits of this section. 11 

(h) That claimant must, on or before August 25, 1920, nh j 
a relinquishment to the United States of all right, title, and in- 
terest in and to the land, together with an application for a lease. 
This relinquishment must be in the form of an unconditional 
quitclaim deed, duly executed and acknowledged, but not rec- 
orded, and when filed will be held for such action as the facts 
and the law in the case warrant and require. 

(i) That claimant must pay for one-eighth of the value at the 
time of production of all oil and gas produced prior to date of 
filing relinquishment and application for relief, exclusive of oil 
and gas used on the land for production purposes, or unavoid- 
ably lost. 

19. Relief that may be granted under section 18 : 

(a) Lands not in naval petroleum reserves. — A qualified 
claimant, upon complying with the provisions of the Act and 
these regulations, will be entitled to a twenty-year lease from 
the United States, commencing and effective as of the date of 
filing relinquishment and application for relief, substantially 
in the form prescribed in section 17 hereof, at a royalty to be 
fixed by the Secretary of the Interior, but not less than 12J per 
cent of all oil and gas produced exclusive of that used for pro- 

the 1st day of January, 1920, which did not increase or reduce the acreage 
held or claimed in excess of the maximum by either party. 

10 The word "asserted" before amendment read "initiated." 

11 Paragraph g was stricken out With no substitution. It read as fol- 
lows: 

(g) That all parties having an interest in the claim by stock ownership, 
stock holding or stock control, must be citizens of the United States, or 
of a country, the laws, customs, or regulations of which do not deny like 
or similar privileges to citizens or corporations of the United Slates. 



LAND OFFICE REGULATIONS 351 

duction purposes on the claim, or unavoidably lost. There is, 
however, a limitation placed by the Act upon the acreage 
that may be included in such lease. If the geologic oil 
or gas structure of the producing field in which the claim 
is situated does not exceed 640 acres in area the lease may include 
the entire area if covered by the claim ; but if the area of such 
structure exceeds 640 acres the Act provides that not more than 
one-half of the area, same to be selected by the claimant but in 
no case to exceed 3,200 acres, may be leased to any one claimant. 

(&) Lands in naval petroleum reserves. — If the land claimed 
is within a naval petroleum reserve the claimant will be entitled 
to lease only the producing wells on the claim, together with an 
area of land sufficient for the operation of such wells, upon a 
royalty to be fixed by the Secretary of the Interior but not less 
than 12J per cent of the production except that used for pro- 
duction purposes on the claim or unavoidably lost. The Act for- 
bids the drilling of any wells in lands subject to this provision 
within 660 feet of the leased wells without the consent of the 
lessee. It further provides that the President may, in his dis- 
cretion, lease the remainder or any part of the claim on which 
such wells have been drilled, and in the event of such leasing 
the claimant shall have a preference to such lease. The President 
may also permit the lessee of any well to drill additional wells 
within the limited area of 660 feet upon such terms and condi- 
tions as he may prescribe. These terms and conditions can not 
be prescribed here, but will be determined on the merits in each 
separate case. 

"(c) Royalties. — The royalties payable under leases granted 
pursuant to section 18 of the Act are cumulative, and are hereby 
determined and prescribed as follows : 12 

12 Paragraph c before substitution read : 

(c) Royalties. — The royalties payable under leases granted pursuant 
to section 18 of this act are hereby determined and prescribed as follows: 

For all oil of 30 degrees Baume" or over, upon each claim on which the 
wells average 200 barrels or more per day per month, 33g; per cent; upon 
each claim on which the wells average from 100 to 200 barrels per day per 
month, 25 per cent; upon each claim on which the wells average from 50 
to 100 barrels per day per month, 20 per cent; upon each claim on which 
the wells average from 20 to 50 barrels per day per month, 16§ per cent, 



352 MORRISON'S OIL RIGHTS 

"For all oil produced of 30 degrees Baume or over upon each 
claim on which the wells average not exceeding 20 barrels per 
day for the calendar month, 12^ per cent; upon each claim on 
which the wells average more than 20 barrels and not more than 
50 barrels per day for the calendar month, 16| per cent; upon 
each claim on which the wells average more than 50 barrels and 
not more than 100 barrels per day for the calendar month, 20 
per cent ; upon each claim on which the wells average more than 
100 barrels per day for the calendar month, 25 per cent. 

"For all oil produced of less than 30 degrees Baume upon each 
claim on which the wells average not exceeding 20 barrels per 
day for the calendar month, 12 J per cent; upon each claim on 
which the wells average more than 20 barrels and not more than 
50 barrels per day for the calendar month, 14f per cent; upon 
each claim on which the wells average more than 50 barrels and 
not more than 100 barrels per day for the calendar month, 16f 
per cent ; upon each claim on which the wells average more than 
100 barrels per day for the calendar month, 20 per cent. 

"Only wells which have a commercial production during at 
least a part of the month shall be considered in ascertaining the 
average production herein, and the Secretary of the Interior 
shall determine what are commercially productive wells under 
this provision. 

"The royalties on gas produced, if any, will be fixed and deter- 
mined in each lease." 

20. Conditions for relief under section 19: 

A. For permit. — (a) That the land must not be in a naval 
petroleum reserve. 

and upon each claim on which the wells average less than 20 barrels per 
day per month, 12£ per cent. 

For all claims producing oil of less than 30 degrees Baume, upon each 
claim on which the wells average 200 barrels or more per day per month, 
25 per cent; on each claim on which the wells average 100 to 200 barrels 
per day per month, 20 per cent; upon each claim on which the wells aver- 
age from 50 to 100 barrels per day per month, 16§ per cent; upon each 
claim on which the wells average from 20 to 50 barrels per day per month, 
14f per cent, and upon each claim on which the wells average less than 
20 barrels per day per month, 12J per cent. 

The royalties on gas produced, if any, will be fixed and determined in 
each lease. 



LAND OFFICE REGULATIONS 353 

(b) That applicant must have been an occupant or claimant 
of the land on October 1, 1919, under a claim initiated under 
the placer mining laws by him or his predecessor when the land 
was not withdrawn. 

(c) That claimant, by himself or predecessor in interest, must 
have performed all acts under the preexisting laws necessary to 
valid locations, except to make discovery. 

(d) That prior to February 25, 1920, claimant must have per- 
formed work or expended on or for the benefit of such locations 
an amount equal in the aggregate to $250 for each location. 

(e) That no claimant who has been guilty of any fraud or 
who had knowledge or reasonable grounds to know of any fraud, 
or who has not acted honestly and in good faith, shall be en- 
titled to any of the benefits of this section. 13 

(g) That claimant must, on or before August 25, 1920, file a 
relinqishment to the United States of all right, title, and interest 
in and to the land, together with an application for a permit. 
This relinquishment must be in the form of an unconditional 
quitclaim deed, duly executed and acknowledged, but not re- 
corded, and when filed will be held for such action as the facts 
and the law in the case warrant and require. 

B. For lease. — The conditions necessary to obtaining a lease 
under section 19 of the Act are identical with those outlined in 
paragraphs (a), (&), (e), (/), and (g), for permits, together 
with the following additoinal conditions: 

(a) That claimant must have made a discovery of oil or gas 
on or before February 25, 1920. 

(b) That claimant must not be entitled to relief on the land 
in question under section 18 of the Act. 

(c) That claimant must pay for one-eighth of the past pro- 
duction up to date of filing application for relief, exclusive of 
that used on the land for production purposes or unavoidably 
lost. . 

13 Paragraph / which was stricken out read: 

(/) That all parties having an interest in the claim by stock owner- 
ship, stock holding, or stock control, must be citizens of the United States 
or of a country the laws, customs, or regulations of which do not deny 
like or similar privileges to citizens or corporations of the United States. 
M. O. R.— 23. 



354. morrison's oil rights 

21. Relief that may be granted under section 19 : 

(a) A claimant qualified under the above conditions relating 
to permits, upon complying with the provisions of the Act and 
these regulations, will be entitled to a prospecting permit upon 
the same terms, conditions, and limitations as to acreage, as other 
permits provided for in the Act, substantially in form prescribed 
in section 6 hereof. 14 

(&) A claimant qualified under the above conditions relating 
to leases is entitled to a twenty-year lease from the United States, 
effective from date of filing application for relief, substantially 
in the form prescribed in section 17 hereof, the royalty to be 
fixed by the Secretary of the Interior, but such royalty may not 
be less than 12J per cent of all oil and gas produced exclusive 
of that used for production purposes on the land or unavoidably 
lost. In the event the land is in the geologic structure of proven 
territory at the time of granting the permit under this section, 
the royalty required under the lease based thereon shall not be 
less than- 12J per cent, but if at the time the permit is granted 
the land is not in proven territory, the amount of royalty will 
be governed by the general terms of the Act as set out in section 
14 thereof. 

22. Alaska claims — Conditions for relief under section 
22: 

A. For permit. — (a) That claimant must have been an oc- 
cupant or claimant of the land on February 25, 1920, under a 
claim initiated under the placer mining laws by claimant or pre- 
decessors prior to November 3, 1910, the date of the executive 
order withdrawing all public lands in Alaska containing petro- 
leum deposits, including those in national forests. 

(b) That claimant must have performed all acts prior to No- 
vember 3, 1910, under the then existing laws necessary to valid 
locations except to make discovery. 

(c) That claimant, (1) prior to November 3, 1910, must have 
made substantial improvements for the discovery of oil or gas 

1 4 The last sentence of paragraph a, stricken out, read : 
Only one permit for not exceeding 2,560 acres will be granted to the 
same person, association, or corporation; hence all claims for relief in 
the form of a permit should be embraced in a single application. 



LAND OFFICE REGULATIONS 355 

on or for each location, or (2) prior to February 25, 1920, ex- 
pended not less that $250 in improvements on or for the benefit 
id) That claimant must on or before February 25, 1921, or 
within six months after final denial or withdrawal of application 
for patent, file a relinquishment to the United States of all right. 
title, and interest in and to the land, executed in the usual form. 
This relinquishment must be in the form of an unconditional 
quitclaim deed, duly executed and acknowledged, but not re- 
corded, and when filed will be held for such action as the facts 
and the law in the case warrant and require- 
In addition to the above, the conditions outlined in paragraphs 
(/) and (g) of sections 20 hereof, are applicable to relief in 
Alaska. 

B. For lease. — The conditions necessary to obtaining a lease 
under section 22 of the Act are identical with those outlined in 
the paragraphs relating to permits in Alaska together with the 
following additional conditions : 

(a) That claimant or predecessors must have drilled an oil or 
lias well on the land to discovery. 

(b) That claimant must pay for one-eighth of the past pro- 
duction exclusive of that used on the land for production pur- 
poses or unavoidably lost. 

23. Alaska claims — Relief that may be granted under sec- 
tion 22 : 

(a) A claimant qualified under the above conditions relating 
to permits, upon complying with the conditions of the Act and 
these regulations will be entitled to prospecting permits under 
the same terms and conditions as other permits in Alaska pro- 
vided for in section 13 of the Act, substantially in the form pre- 
scribed in section 6 hereof. 

(b) A claimant qualified under the above conditions relating 
to leases is entitled to a lease substantially in the form prescribed 
in section 17 hereof, the rental and royalty to be fixed by the Sec- 
retary of the Interior and specified in the lease, subject to re- 
adjustment at the end of each twenty-year period of the lease. 

(c) Only five permits or leases in the aggregate may be held at 
any one time by any claimant, and not more than 1,280 acres 
may be included in one permit under section 22 of the Act. 



356 MORRISON'S OIL RIGHTS 

The following* additional rule was added by the Secretary of 
the Interior, April 16, 1920, by Circular No. 687. 

23J. Who may apply. — All proper parties to a claim for relief 
under sections 18, 19, or 22 of the act should join in the appli- 
cation, but, if for any sufficient reason that is impracticable, 
any person claiming' a fractional or undivided interest in such 
claim may make application for a lease or permit, stating the 
nature and extent of his interest, and the reasons for nonjoinder 
of his co-owner or co-owners. In cases where two or more appli- 
cations are made for the same claim or part of a claim, leases or 
permits will be granted to one or more of the claimants, as law 
and facts shall warrant and as shall be deemed just. 

24. Beneficiaries under leases or permits. — All leases or 
permits under sections 18, 19, and 22 shall inure to the benefit 
of the claimant and all persons claiming through or under him 
by lease, contract, or otherwise, as their interests may appear, 
subject to the same limitations as to area and acreage as is pro- 
vided for claimant, but such persons will not necessarily be made 
parties to government leases, and may assert their rights in the 
courts. Disputes of this character are not to be confused with 
adverse claims based upon independent title, hereinafter referred 
to. (See section 28 hereof.) 

25. Form and contents of application. — No set forms of ap- 
plication for a lease under sections 18, 19, or 22, or a permit un- 
der sections 19 and 22 of the Act can be prescribed because the 
facts and circumstances pertaining to claims for relief are so 
varied. ^Applications for such leases or permits must be made 
under oath and the supporting documents and papers certified 
or under oath so far as practicable. The application, with all 
the accompanying papers, should be filed in the United States 
Land Office of the district in which the land is situated. Appli- 
cations and supporting papers need not be executed in duplicate, 
but one complete copy of each application and supporting papers 
(except abstract of title) should be filed with the application, 
which copy will be transmitted by the register and receiver to 
the Chief of Field Division and notation to that effect made on 
the original. The application should contain full information 
as to the facts upon which the applicant relies for relief, covering 



LAND OFFICE REGULATIONS 357 

the following points and such additional matters as may, from 
the peculiar facts in the case, be material in the establishment of 
his claim under the law : 

(a) Date of application for lease or permit. 

(b) Applicant's name and post-office address. 

(c) Description of land. — The land for which the applica 
tion is made must be described by legal subdivisions of section, 
township, and range, if surveyed ; if not surveyed, then by metes 
and bounds and courses and distances from some permanent 
monument. If the application is for a lease of unsurveyed land, 
the applicant, after he has been awarded the right to a lease, 
but before issuance thereof, will be required to deposit with the 
United States surveyor general of the State in which the land 
is situated the estimated cost of making a survey of the land, 
the balance, if any, after the survey is completed to be returned. 

(d) Origin and basis of applicant's claim for relief. — The 
applicant must bring his claim clearly within all the require- 
ments of the act as specificalty pointed out in sections 18, 20, and 
22 of these regulations. Every application must be supported 
by a duly certified abstract of title to the land, brought up to 
the date of filing the application. In the event an abstract of 
title is already on file in the Land Department, a supplemental 
abstract extending over the period or periods not covered by the 
former, may be fnrnished, and if furnished will be considered 
in connection with the abstract already on file. If any fraud 
has been committed in connection therewith, then a full affirma- 
tive showing must be made by the applicant to the effect that 
he has not been a party to such fraud, and that he has not been 
guilty of any fraud or had knowledge of fraud or reasonable 
grounds to know of any fraud in connection with his claim. 
If an application for patent has been filed, a brief resume of 
the actions taken thereon should be stated. If the land is or 
has been involved in litigation in the Courts, to which the United 
States is a party, the status or result of such litigation should be 
furnished. 

(e) Particulars as to conflicting claims or interests. — -All con- 
flicting or disputed claims, if any, to the land or production 



358 MORRISON'* OIL RIGHTS 

therefrom, specifying the character and extent of such interests,, 
must be shown. 

(/) Discovery. — Before a lease may be awarded under the 
relief sections of the Act it must be satisfactorily shown that 
the applicant or his predecessors have drilled a well to a sub- 
stantial and certain discovery of oil or gas in a producing strat- 
um on the land covered by the location under which the appli- 
cant is asserting his claim. 

(g) Wells, improvements, and production. — With each ap- 
plication for a lease under sections 18, 19, or 22 of the act there 
must be filed a complete and detailed statement showing the 
number, depth, condition, and present daily production of all 
wells drilled on the land by the applicant and his predecessors 
in interest, and the nature and extent of all other improvements 
placed thereon by them. 

With each application for a permit under sections 19 or 22 of 
the Act, a description of the work performed and improvements 
made upon or for the benefit of the location by the applicant and 
his predecessors must be filed, together with an itemized state- 
ment of the cost thereof. If the application is made under 
section 22, the date the work was performed or the improvements 
made must also be shown. 

In either case applicant must show the position of all wells 
and improvements by courses and distances from the nearest 
corner of the public land survey, if the land is surveyed ; if not- 
surveyed, then from a corner of the claim. This may be shown 
by means of a diagram. 

(h) Amount and value of past production. — Claimant must 
furnish a complete detailed statement, by months, of all past 
production from the land, up to the date of filing the application 
and relinquishment, showing (1) the grade and total quantity 
of oil and gas produced; (2) the amount sold or otherwise dis- 
posed of, to whom sold, and the selling price or other considera- 
tion received therefor; (3) a statement of the grade and amount 
of any and all such production held in storage, when produced, 
aud the value at time of production; and (4) the amount con- 
sumed for production purposes on the land, or unavoidably lost. 

Copies of any and all contracts under which oil or gas pro 



LAND OFFICE REGULATIONS 359 

duced from the land has been or is being sold or otherwise dis- 
posed of must be furnished. 15 

"(i) Inspection of records. — The agreement on the part of the 
applicant to permit the inspection of any and all books, records, 
and accounts having any bearing on the data or information 
required by the application and to furnish copies or abstracts 
of such books, records, or accounts, on demand." 16 

(j) Interest in other leases and permits. — The applicant will 
also furnish a complete statement of all lands for which he has 
filed application for lease or permit under sections 18, 19, and 
22 of the act, and of such lands as are included in other applica- 
tions in which he has any direct or indirect interest, together 
with a full disclosure of such interest by stock ownership or 
otherwise. If the applicant is a corporation, a certified copy 
of its articles of incorporation must be furnished, and a full 
disclosure made of the ownership of its stock, whether such stock 
is owned, held, or controlled directly or indirectly by any other 
person or corporation, who or which is an applicant for or a 
holder of a lease under said sections, and, in the event of such 
ownership, a description of the legal subdivisions of all the lands 
affected thereby is required. In the event the lands so affected 
are not surveyed they may be described by the usual method 
of courses and distances and acreage. 

( '{k) Limitation of area. — Applications for lease under sec- 
tion 18 of the Act should disclose all other applications, in 
which the applicant is directly or indirectly interested, for lease 
under said section for lands (describing same) in the same geo- 
logic structure; and applications under section 22 of the act 
should show all other applications for leases or permits under 
said section. The boundaries of the geologic structures of the 
various producing fields will be determined and announced by 

15 The first line of the last paragraph of h was stricken out. It read: 
<l The statement of sales should he corroborated by the purchasers." 

16 Paragraph i before substitution read : 

(i) Investment and cost of operation. — The applicant should make a 
full showing as to (1) the actual cost of wells, improvements, and equip- 
ment for the development of and operation upon the land; (2) the present 
value of such wells, improvements, and equipments; and (3) the present 
cost of operation. 



360 MORRISON'S OIL RIGHTS 

the United States Geological Survey under supervision of the 
Secretary of the Interior, and such information will be placed 
on file in all United States Land Offices." 17 

26. Payment of Royalty on past production. — The appli- 
cation must be accompanied by a certified check in the amount 
of one-eighth of the gross value of all oil and gas produced 
and sold or held in storage, as per the statement required in 
paragraph 25 (h). All such sums will be held by. the receiver 
in his account of "Trust Funds — Unearned Moneys" to await 
instructions as to their 'disposition. In lieu of the certified check 
herein required, the applicant may be permitted to deposit a 
bond by approved surety company in an amount not less than 
one-eighth of the estimated gross value of all oil and gas pro- 
duced and sold or held in storage, securing the payment to the 
United States within thirty days from the award of the lease 
of the cash value of the past production due the United States 
under this Act. In cases where the proceeds, or part thereof, of 
such past production have been deposited in escrow, pursuant 
to operating agreements under the Act of August 25, 1914 (38 
Stat., 708), or where in suits brought by the government affect- 
ing such lands the proceeds of production, or part thereof, have 
been impounded in the custody of receivers, a formal tender may 
be made of the funds so held in escrow or impounded to the ex- 
tent available or in the amount necessary, as the case may be, 
in lieu of such cash payment. In such cases the interest accumu- 
lating on such escrowed 1 or impounded moneys after. the tender 
is made will go to the government. 

17 Paragraph k before substitution read : 

(k) Limitation of area. — The application should show that the area 
applied for together with any other areas for which the applicant has 
made application for a lease or permit or in which he is directly or in- 
directly interested, is not in excess of the limitations provided in sections 
18, 19, or 22 of the Act, as the case may be, as to the maximum area that 
may be leased to any one person or corporation within the same geologic 
oil or gas structure. (See sees. 19, 21, and 23 hereof.) The boundaries 
of the geologic structures of the various producing fields will be deter 
mined and announced by the United States Geological Survey under super 
vision of the Secretary of the Interior and such information will be placed 
on file in all United States Land Oilices. 



LAND OFFICE REGULATIONS 36.1 

Operating contracts made under the provisions of the Act 
of August 25, 1914, supra, and in operation at the time of such 
tender, will not be terminated until the entire transaction of 
granting a lease and payment of royalty on past production 
shall have been consummated; nor will the Department of Jus- 
tice be requested to dismiss any suits involving the land affected 
until the application for a lease has been adjudicated and ap- 
proved; whereupon, after the suit has been dismissed and the 
impounded money tendered paid over to the government, the 
lease will be executed and delivered. 

27. Publication of notice. — Immediately upon the filing of 
an application for a lease or permit under sections 18, 19, or 22 
of the Act, the register and receiver will cause to be published, 
at the expense of the applicant, in a newspaper designated by 
the register, published in the vicinity of the land and most likely 
to give notice to the general public, a notice of the said applica- 
tion in substantially the following form : 

Published Notice of Application. 
Department of the Interior. 
United States Land Office. 



,19 



Notice is hereby, given that of , 

has applied for an oil and gas under section of 

the act of February 25, 1920 (Public, No. 146), for 

section , township of range , 

meridian, County, State of Any and all 

persons having adverse or conflicting claims to said land are 
hereby notified that a full statement, under oath, of such claim 
should be filed in this office 18 showing a superior right to a per- 
mit or lease under said act or in lieu of such application, a 
showing of a valid existing adverse or conflicting claim to the 
land or the minerals therein under the public land laws, on or 

18 The word3 "together with an application" following "this office" were 
struck out. 



•362 MORRISON'S OIL RIGHTS 

before ; otherwise such claim may be dis- 
regarded in granting* the permit or lease applied for. 



Register. 

The register and receiver will fix a date in the notice on or 
before which adverse or conflicting claims may be asserted, which 
date should be not less than thirty nor more than forty days 
after the date of first publication of the notice. 

Such notice will be published in the regular issue and not in 
any supplement of the newspaper, once each week for a period 
of five consecutive weeks if in a weekly paper, or if in a daily 
paper for a period of thirty days. The register and receiver 
will post a copy of said notice in a conspicuous place in their 
office during the period of publication. 

Upon the applicant's furnishing satisfactory proof of such 
publication, but not earlier than the day following that set in 
the published notice on or before which adverse or conflicting 
claims were to be filed, the register and receiver will transmit 
by special letter all papers in the case including any adverse 
or conflicting claims that may have been filed, together with 
proof of posting said notice in their office, to the Commissioner 
of the General Land Office. 

28. Adverse or conflicting claims — procedure. — In case of 
adverse or conflicting claims for leases under sections 18, 19, 
or 22, or permits under sections 19 or 22, the Secretary of the 
Interior is clothed with authority to grant leases or permits, as 
the case may be, to one or more of them as shall be deemed just. 

(a) To have their claims considered in connection with the 
awarding of leases or permits it will be necessary for adverse 
claimants to make full showing (1) of a superior right to a lease 
or permit under this Act, or (2) a superior right under some 
other public land law. If the former the conflicting claimant 
must mate out a complete case in his own behalf as required by 
these regulations, 19 on or before August 25, 1920. 

19 The words "on or before August 25, 1920" were added by the amend- 
ment of March 25. 



LAND OFFICE REGULATIONS 363 

(b) Upon receipt of the application and showing of an adverse 
claimant the Commissioner of the General Land Office will con- 
sider same. If, in his judgment, the adverse claimant has failed 
to make a prima facie case showing that he is entitled to a lease 
or permit, as the case may be, for at least part of the land, his 
application will be rejected subject to appeal to the Secretaiy 
of the Interior. Bnt if the adverse claimant makes out a prima 
facie case the Commissioner will take such course as may be 
advisable under the circumstances of each particular case to 
settle and adjust the rights of the respective parties, and may, 
if deemed necessary, order a formal hearing to settle disputed 
questions of fact. In the absence of appeal to the Secretary of 
the Interior from the final order or decision of the Commissioner, 
same shall be conclusive. 

29. Compromises under section 18a. — No special procedure 
will be outlined under this section. Any request for a compro- 
mise or settlement under this section which may be filed in the 
Land Department will be transmitted to the President with 
such report as may be deemed advisable under the circumstances 
of the particular case. In case the land is in a naval petroleum 
reserve the Navy Department will be consulted before making 
such report. 

IV. Rights of Way for Pipe Lines. 

30. Section 28 of the act grants to any applicant having the 
qualifications outlined in section 1 of these regulations, rights of 
way through public lands of the United States, including na- 
tional forests, for pipe-line purposes for the transportation of oil 
or natural gas, on condition that the pipe lines for which rights 
of way are granted shall be operated and maintained as common 
carriers. The grant carries with it the right to the use of the 
ground actually occupied by the pipe line, and 25 feet on each 
side thereof for the purpose of construction, maintenance, and 
operation of the pipe line. Applicants for rights of way under 
this act will be governed by the regulations set forth in circular 
of June 6, 1908 (36 L. D. 567) in so far as applicable, appro- 
priate changes being made in the forms therein prescribed to 
make them applicable to right-of-way cases arising under the 



: '64 MORRISON'S OIL RIGHT? 

act of February 25, 1920 (Public No. 146), for pipe lines to be 
constructed, maintained, and operated as common carriers. Fail- 
ure on the part of grantee to fulfil the conditions imposed by 
the act shall be ground for forfeiture of the grant by the United 
fStates district court for the district in which the property, or 
some part thereof, is situated. 

V. Pees and Commissions. 

31. Under the authority of section 38 of the Act, the following 
fees and commissions are prescribed for transactions under the 
act: 

(a) For receiving and acting on each application for a per- 
mit, lease, or other right filed in the district land office in ac- 
cordance with these regulations, there shall be paid a fee of $2 
for each 160 acres, or fraction thereof, in such application, but 
such fee in no case to be less than $10, the same to be paid by 
the applicant and considered as earned when paid, and to be 
credited in equal parts on the compensation of the register and 
receiver within the limitations provided by law. 

( b ) A commission of 1 per cent on all moneys received in 
each receiver's office, to be equally divided between the register 
and receiver; such commission will not be collected from the 
applicant, lessee, or permittee in addition to the moneys other- 
wise provided to be paid. 

It should be understood that the commission here provided for 
will not affect the disposition of the proceeds arising from opera- 
tions under the Act as provided in section 35 thereof ; also that 
such commission will be credited on compensation of registers 
and receivers only to the extent of the limitation provided by 
law for maximum compensation of such officers. 

VI. Repealing and Saving Clauses. 

32. Section 37 of the Act provides that hereafter the deposits 
of coal, phosphate, sodium, oil, oil shale, and gas, referred to 
and described therein, may be disposed of only in the manner 
provided in the Act "except as to valid claims existent at date 
of passage of this Act. and thereafter maintained in compliance 



LAND OFFICE REGULATION S 365 

with the laws under which initiated, which claim* may be per- 
fected under such laws, including discovery." 

Stated negatively, under this section of the Act, the following 
classes of oil or gas placer locations, so called, notwithstanding 
absence of fraud and full compliance with law in other respects, 
may not proceed to patent, viz: 

(a) Any location made after withdrawal of the land. 

(b) Any location made before withdrawal of the land but 
not perfected by discovery at date of withdrawal, which does 
not come within the protective proviso of section 2 of the Act 
of June 25, 1910 (36 Stat. 847) ; that is to say, any claimant 
who, at date of withdrawal, was not a bona iide occupant or 
claimant in diligent prosecution of work leading to discovery 
of oil or gas, and who has not continued in such diligent prose- 
cution to discovery. 

(c) Any location on lands not withdrawn, on which, at the 
date of the Act, the claimant had not made discovery or was not 
in diligent prosecution of work leading to discovery, and does 
not continue such work with diligence to discovery. 

Very respectfully, 

Clay Tallman, 
Commissioner. 
Approved: March 11, 1920. 
Alexander T\ Vogelsang, 

Acting Secretary. 

The circular of March 25, 1920 added a form of bond in this 
language: 

The following form of bond is prescribed for use in compliance 
with the requirements of paragraph (i), section 4 of the regu- 
lations and paragraph 7 of the form of permit shown in section 
6 of the regulations : 



366 MORRISON'S OIL RIGHTS 

BOND OF OIL AND GAS PERMITTEE. 

Act of February 25, 1920 (Public No. 146). 

Department of the Interior, 
General Land Office. 

U. S. Land Office...... 

Serial Number 

Know all men by these presents, That we, , 

of the county of , in the State of , 

as principal, and of the county of , 

in the State of , as surety, are held and firmly bound 

unto the United States of America in the sum of dol- 
lars, lawful money of the United States to be paid to the United 
States, for which payment, well and truly to be made, we bind 
ourselves, and each of us, and each of our heirs, executors, ad- 
ministrators or successors, and assigns, jointly and severally by 
these presents. 

Signed with our hands and sealed with our seals this 

day of in the year of our Lord one thousand nine 

hundred and 

The condition of the foregoing obligation is such that, where- 
as the said principal has made application under the act of 
February 25, 1920 (Public No. 146), for a permit to prospect 
for oil and gas for two years upon the following described lands 



and whereas said permit, if granted, will be on condition that 
all operations shall be conducted in accordance with approved 
methods; that all proper precautions shall be exercised to pre- 
vent waste of oil or gas developed in the lands, or the entrance 
of water through wells drilled by, or on behalf of, the principal 
to the oil sands or oil-bearing strata to the destruction of the oil 
deposits. 

Now therefore, if said principal shall promptly repair any 
damage that may result to the oil strata or deposits resulting 



LAND OFFICE REGULATIONS 367 

from improper methods of operation, or from failure to comply 
fully with the aforesaid conditions of said permit, then the 
above obligation is to be void and of no effect; otherwise to re- 
main in full force and virtue. 

Signed, sealed, and delivered in presence of — 

Name and address of witness: 



[t s.] 

Principal. 

[l. s.] 

Surety. 

Land Office Construction of the Leasing Act. 

The act of -February 25, 1920 (Public No. 146), was passed by 
Congress (referring to official correspondence) to cover broadly 
three classes of claims: 

1. Wildcat territory, or unproven oil lands, as to which Con- 
gress provided for the issuance of a prospecting permit for not 
exceeding 2,560 acres in a single body, the prospector to be 
entitled to the exclusive possession of the land for a period of 
two years, on condition that he perform a reasonable amount of 
development work. 

If he discovers oil or gas, he is entitled to a lease for one-fourth 
of the- land at a nominal royalty, 5 per cent, and a preference 
right to lease the remainder of the land at a royalty to be fixed 
by the Secretary of the Interior or determined by competitive 
bidding. 

Proven lands not covered by the claims hereinafter described 
are* to be offered for lease to the general public in areas not 
exceeding 640 acres, on a royalty announced in advance of lease, 
to be awarded to the qualified bidder offering the highest bonus. 

2. Claims initiated under the old mining laws prior to with- 
drawal but which, because of lack of diligence or continuous 
working, or because of the presence of dummy locators among 



o68 MOOBRISON'S OIL BiGHJES 

those originally filing the claim, could uot be perfected under 
those laws. 

This class of claims covers (a) those on which the locators or 
their successors in interest had drilled wells and discovered oil 
in paying quantities; (b) those claims located prior to with- 
drawal upon which the locators had complied with the require- 
ments of the mining- laws except as to discovery, and had 
expended at least $250 in development work. To such claimants 
Congress accorded equitable relief, by providing that in the 
absence of fraud or knowledge of fraud by the party applying, 
a lease might be granted to the claims containing oil wells, on 
payment of one-eighth of the value of past production, and such 
royalty for future, not less than one-eighth, as might be deter- 
mined. 

That as to the second class of claims, where discovery had not 
been made, claimants should be entitled to a prospecting permit 
like that hereinbefore described, in order that they might con- 
tinue their explorations and become entitled to leases upon dis- 
covery of oil or gas. 

3. The concluding section of the act takes care of claims 
existing under the mining laws at date of their repeal, in so far 
as they apply to oil or gas lands, if such claims were valid, 
existent at date of the act of February 25, 1920, and thereafter 
maintained in compliance with law. 

This provision of law is construed by the Department in 
harmony with the provisions of the act of June 25, 1910, supra, 1 
and with the decisions of the court as to the rights of locators 
in possession of lands prior to discovery, namely, that in-order 
to be entitled to hold and perfect such claims under the old 
mining laws, the applicant must show that his location was made 
prior to withdrawal, and that he at date of withdrawal was a 
bona fide occupant in diligent prosecution of work leading to 
the discovery of oil or gas, and has continued such diligent prose- 
cution to discovery. 

The act is not a perfect piece of legislation, but that is a failing 
common to most laws. We, however, must administer the act 

3 The Pickett Act, page 2o5. 



LAND OFFICE REGULATIONS 369 

as it is. Considering its history, I feel warranted in saying that 
Congress is not likely to change or amend it in the near fnture. 

Land Service Bidletin July 1920. 

The above is the construction of the Commissioner of the 
General Land Office on the oil sections of the Leasing Act 
printed in connection with correspondence given at length in 
the same bulletin. 

The letters of the Commissioner supporting his position as to 
what is meant by valid discovery and valid location quote from 
McLemore v. Express Co. 158 Cal. 559, and Cole v. Ralph, 40 
Sup. Ct. Rep. 321, cases heretofore cited in this book the quota- 
tion from the California case being: 

"But where the location is incomplete, no question of assess- 
ment work is involved. What the attempting locator has is the 
right to continue in possession, undisturbed by any form of 
hostile or clandestine entry, while he is diligently prosecuting 
his work to a discovery. This diligent prosecution of the work 
of discovery does not mean the doing of assessment work. It 
does not mean any attempted holding, by cabin, lumber pile or 
unused derrick. It means the diligent, continuous prosecu- 
tion of the work, with the expenditure of whatever money may 
be necessary to the end in view." 

The same letters also argue section 37, the Saving clause of 
the Act. 

These ex parte suggestions in advance of judicial rulings have 
value only as defining the position of the Department and can 
have no effect upon the final determination by tli3 Courts. 

The material point discussed in the Bulletin is whether under 
the terms of the Saving Section, Oil Placers which .are regular 
in their notice, staking and record but have no discovery, are 
protected by merely doing the annual labor or whether their 
owners must be engaged in the diligent prosecution of sinking 
or other development and on this large and important class of 
claims it is not our province to anticipate the final interpretation 
although we are not in accord with the interpretation which the 
Department insists upon. 
M. 0. R.— 24. 



370 morrison's oil rights 

Rulings on the Oil Sections. 
Conflicting Preference Rights Under Sections 19 and 20. 

The preference right attaches to the claim first initiated and 
legally maintained. A locator of a mining claim who has com- 
plied with all the provisions of Section 19 of the act, will be 
entitled to a preference right over a homestead entryman whose 
entry was made after the location, the homesteader, however, 
being entitled to hold the surface right. If the homestead entry 
was made prior to the date of the placer location, the home- 
stead claimant will have the superior right, except in the case 
of a stockraising homestead, wherein all minerals are reserved 
to the United States. 

Permit for Unwithdrawn Land Covered by Agriculural Entry. 

No permit will be granted until entryman has elected to take 
patent with reservation of oil and gas to the United States. If 
such a waiver is filed, entryman has preference right to permit 
or lease for lands covered by such entry. 

Preference Rights under Section 20. 

Preference rights under Section 20 will be granted in cases 
where entry was made prior to February 25, 1^20, for unwith- 
drawn or unclassified lands, without any reservation of the 
minerals by the United States, and thereafter the claimant files 
a waiver of his right under the entry to the oil or gas. No 
preference right where land is covered "by stock-raising entry, 
nor entry made subject to the Act of July 17, 1914, with oil 
and gas reservation. 

Assignability of Permits. 

Right to a permit is not assignable, but after permit is granted, 
it may be assigned upon consent ox tne aeeretury ox tae interior, 
first had and obtained. 



LAND 0FFIC1 REGULATIONS 371 

Incontiguoas Tracts. 

Incontiguous tracts within a limited radius may be included 
in a permit where conditions are such that, because of prior 
disposals, a reasonable area of contiguous land can not be pro- 
cured. 

Operating Leases and Permits While Application Is Pending. 

No objection will be raised to the operation of a producing 
well by a qualified claimant during the pendency of his applica- 
tion for lease, but he will be liable for whatever royalty is fixed 
by the lease for production during that period. An applicant 
for permit may do prospecting work at his own risk during the 
pendency of his application. 

Pending Application for Permit, Land Designated as Oil Struc- 
ture. 

Where after application under Section 13, for a permit, and 
before permit is granted, the land is designated as within the 
structure of a producing oil or gas field, permit can not be al- 
lowed, and all rights under the application will fall. 

Preference Right under Section 20. 

A permit to prospect will be granted an applicant entitled 
thereto under Section 20 of the act, notwithstanding the land 
is part of a producing oil structure, where no oil has been dis- 
covered on the land applied for, provided that only one permit 
may be granted in the same structure to the same applicant. 

Carey Act Selections as Affected by Leasing Law. 

The lands in a Carey Act segregation come under the pro- 
visions of Sec. 2 of the oil and gas regulations, and permits and 
leases may be granted for such lands, subject to such stipula- 
tions and requirements as the Government may impose for the 
protection of the reclamation project, to the end that the best 
development of the lands, both for mineral and agricultural 
purposes, may be accomplished. 



372 MORRISON'S OIL RIGHTS 

Neither the State nor its contractor would be entitled to any 
preference right nnder Section 20 of the act, and whether a 
Carey Act entryman would have such a right would depend upon 
the conditions affecting* his entry being such as to bring him 
within the provisions of Section 20. 

Drilling Contracts under a Permit. 

If a contractor desires to be recognized in connection with a 
permit, he must file his contract for approval and be charged 
with the interest covered thereby. It is not necessary for him 
to do this and if he desires he may explore the land under con- 
tract with the permittee, and bring his contract to the attention 
of the Department only if and when he desires to be recognized 
as interested in such lease as may be applied for. 

Office Practice — Conflicting* Applications. 

The issuance of a permit should be deferred, where all is 
regular and the applicant appears entitled to the permit, until 
the conflicting applicants have been notified that their applica- 
tions have been rejected, because subsequent in time, subject to 
the right of appeal within fifteen days from receipt of notice. 

Posting Notice by Agent. 

Under the law, the action of an agent in posting notice is the 
action of his principal, but the application for permit may not 
be executed by agent. 

Permits of Corporations as Affected by Stockholder's Permits. 

The maximum number of permits to a corporation is not 
limited by permits of individual stockholders, but a corporation 
may have an interest in not more than three permits in same 
state, directly or indirectly. Individual may hold direct interest 
in not more than three permits and his total interests as per- 
mittee and stockholder may not exceed an aggregate of 7,680 
acres in the same state. 



s 

LAND OFFICE REGULATIONS 373 

Preference Right Permits to Qualified Assignees. 

Section 19 of the act of February 25, 1920, is construed to 
permit qualified assignees since October 1, 1919, to secure pref- 
erence right permits, but no such transferee will be permitted 
to hold permits exceeding 2560 acres for such lands in the same 
geologic structure, nor more than three times that area in the 
same state. 

Permits in Alaska. 

The same rule applies in Alaska as in the States; that is not 
more than one permit in same structure. 

Rulings on Conflicts with Agricultural Entries. 

1. If the land was withdrawn or classified at the time of entry 
so that the entry was made with a reservation of the mineral, 
there is no preference right; conversely, to entitle the home- 
steader to a preference, the entry must have been properly made 
without a reservation of the mineral. 

2. There can be no preference right on an entry allowed after 
February 25, 1920. (Regulations, sec. 12). 

3. There can be no preference right on a stock-raising entry 
under the Act of December 29, 1916, at all, for under that Act 
aH entries are made with a reservation of the mineral. 

4. If the homestead entry was made without reservation of the 
mineral, but after the lands were of known mineral character, 
and merely for the purpose of acquiring mineral rights, there 
is no preference right to a permit, because (a) such an entry 
should have been made with a reservation of the mineral, and 
the requisite non-mineral affidavit on which the entry was pro- 
cured was fraudulent, and (b) the entry is not "of lands bona 
fide entered as agricultural?' 

5. But where one has an original entry under the 160 or 320- 
acre law and an additional under the stock-raising (640-acre) 
law, the entryman will have the same rights under, the original 
as he would have had had he not made the additional. 

6. Where one has an entry without a reservation of the 
mineral, nobody (not even the entryman himself) may acquire 



374 MORRISON'S OIL RIGHTS 

a permit or lease for the mineral so long as the entry stands in 
that shape, for the entry segregates both the surface and mineral 
until such time as the reservation is created. 

7. But, if the entryman in the case last above mentioned, files 
a waiver of the mineral rights in the land, then he may exercise 
his preference right, if he has any, and if not, others may file 
application for a mineral permit or lease. 

8. The "reservation" of the mineral above referred to, is pur- 
suant to Sec. 2 of the Act of July 17, 1914 (38 Stat., 509), which 
provides that the mineral occupant shall pay any damage caused 
to the agricultural claimant. 

9. Where a patented entry or one on which final certificate 
has issued, has been sold or transferred, the transferee would 
have the same rights as the entryman, provided he acquired the 
land before January 1, 1918, but if he acquired it after that 
date, there would be no preference right to anybody. 

10. A patentee, or entryman with final certificate, with a 
reservation of the mineral to the Government, who has a pref- 
erence right, cannot withhold the land from development in- 
definitely. Sec. 12 of the regulations provides that if anybody 
else applies for a permit on the land, the preference right man 
shall be given notice and allowed thirty (30) days within which 
to exercise his preference, and apply for a permit himself ; other- 
wise he will be out. 

11. The preference right claimant must be qualified to take a 
permit under the law the same as anybody else ; for instance, an 
alien transferree of patented land could not get a permit or 
lease ; one who has already received the limit of permits allowed, 
could not get a permit. 

12. The matter of whether the agricultural entry on which a 
preference right to a permit is predicated, is within or without 
a known producing structure cuts no figure in connection with 
the preference rights here under consideration provided, that, 
only one permit may be granted in the same structure. 

13. An oil placer location perfected by discovery segregates 
the land from any further entry so long as the claim is main- 
rained, but in case of attempted homestead, the mineral claimant 
must file contest to protect his interest, as the Land Department 



LAND OFFICE REGULATIONS 375 

has no record of his claim in the absence of an application for 
patent. 

14. An oil placer location, perfected by discovery, laid over 
land embraced in a prior, valid, subsisting homestead entry, is 
ineffective so long as the homestead stands. 1 (Prior to the Act 
of Juty 17, 1914, the mineral claimant could contest the home- 
stead and cause its cancellation; under that Act the home- 
steader may retain surface rights and the mineral is auto- 
matically withdrawn; and under the Leasing Act the home- 
steader might have a preference right to a permit for the min- 
eral.) 

15. But a mere "paper" oil placer location (that is one without 
discovery) will not prevent a homestead entry of the land. 

16. Where the claimant of a "paper" location is on the ground 
in diligent prosecution of work leading to discovery at the time 
the land is homesteaded, he may by contest defeat the home- 
stead entry. 

17. In case of conflict between a preference right claimant 
under Sees. 18 and 19, and one under Sec. 20, the one would 
prevail whose rights were prior in their lawful inception. 

18. The allowance, (after February 25, 1920) of a home- 
stead entry on land covered by valid rights to relief permits or 
leases under Sees. 18 or 19, is entirely within the discretion of 
the Secretary of the Interior. 

19. Where a homestead entry (not under the Grazing Act) is 
made without a reservation of the oil to the Government and the 
land is withdrawn or classified as oil land before completed 
final proof is submitted, the entryman must take patent with 
a reservation of the oil, unless he can procure a reclassification 
of the land by the Department or a removal of the withdrawal, 
or unless he can show at a hearing (the burden of proof being 
on him) that the land was not of a known mineral character at 
date of final proof. 

20. But where, in the case last stated, the withdrawal or 
classification as mineral was not made until after final proof was 

Note 1. A stock-raising homestead is an exception to this rule, for all 
minerals are reserved therefrom, and the oil deposits could have beei- 
located under the placer law up to Feb. 25, 1920. 



>76 MORRISON'S OIL RIGHTS 

submitted, the entryinan will be entitled to a patent without a 
reservation, unless the Government can show (the burden of 
proof being on the Government), at a hearing if necessary, that 
the land was of known mineral character at the date of final 
proof. If the Government can show this, the result will be the 
same regardless of whether there has been a withdrawal or 
classification. 

The same general principles above stated apply to other kinds 
of non-mineral entries, except land acquired under railroad 
grants. 

Land Service Bulletin, July, 1920. 

The following are some of the more recent Rulings of the 
Department in relation to oil and gas permits and leases, which 
have been made since the Land Service Bulletin above cited: — 

Discovery on Adjoining Claims. 

In case of two claims that adjoin, it is necessary to have dis- 
covery on each claim, to secure lease for both under Section 18. 
If the discovery is only on one claim the lease must be confined 
to the limits of the claim containing the discovery. 

Right of Assignees to Lease. 

The grantee of good faith locators may transfer his interest 
to contractors, assignees, or lessees who were in possession prior 
to July 1, 1919, and each of such owners may then apply for a 
J ease of such portion of the claim as may be agreed upon among 
those entitled to the claim as a whole. This is contingent upon 
the condition that grantee of locators has not been holding more 
than the maximum allowed under Section 18 of the leasing act. 

Party in Interest Must File Application. 

The oil and gas leasing bill provides that permits may be 
issued to a citizen of the United States, and association of such 
ritizens, a corporation organized under the laws of the United 
States or of any State or Territory thereof or a municipality. 

It follows from this that no one but a citizen can obtain 



LAND OFFICE REGULATIONS 377 

any rights under the provisions of said act. This office has held 
that an agent or attorney-in-fact may locate a claim but that the 
party in whose interest the claim is located must file the applica- 
tion for a permit and at that time show his qualifications. The 
citizenship of the agent is not material. 

Assignee of Claim Located Before October 1, 1919. 

An application for oil permit or lease under section 19 may be 
made by an assignee who acquired title after October 1, 1919, 
to a claim located before that date, provided such assignee may 
not acquire permits to more than 2560 acres in the same struc- 
ture or three times that area in the same state. 



CIRCULAR NO. 696. 

PHOSPHATE LAWS AND REGULATIONS, 

Department of the Interior, 

General Land Office, 

Washington, May 22, 1920. 
Registers and Receivers, 

United States Land Offices. 
Siks: Sections 9 to 12, inclusive, of the act of Congress ap- 
proved February 25, 1920 (Public No. 146), entitled "An act 
to promote the mining of coal, phosphate, oil, oil shale, gas, 
and sodium on the public domain," authorize the Secretary of 
the Interior to lease lands belonging to the United States con- 
taining deposits of phosphates, and accordingly the following 
rules and regulations are prescribed for the administration of 
the provisions of said sections of the act : 

1. Lands to Which Applicable. 

The act applies to the lands belonging to the United States 
containing deposits of phosphates, including lands in national 
forests and including the phosphate deposits reserved under laws 



378 MORRISON'S OIL RIGHTS 

authorizing entries and patents with reservation to the United 
States of such deposits; also to phosphate lands in ceded or 
restored Indian reservations the proceeds from the disposition 
of which are the property of the United States. The act is not 
applicable to lands in the Appalachian Forest Reserve' (under 
act of March 1, 1911, 36 Stats., 961), lands in national parks, 
lands withdrawn for military or naval purposes, or lands in* 
ceded or restored Indian reservations the proceeds from the dis- 
position of which belong to the Indians. 

All leases of phosphate deposits within the limits of national 
forests or other reservations or withdrawals to which the act is 
applicable shall be subject tc and contain such conditions, stipu- 
lations, and reservations as the Secretary of the Interior shall 
deem necessary for the protection of the forests, reservations or 
withdrawals, and the uses and purposes for which created. 

2. Leasing" Area. 

Leases may embrace not exceeding 2,560 acres of lands or 
deposits, in compact form, the length of. which shall not exceed 
two and one-half times its width. If surveyed, the lands must 
be taken by legal subdivisions of such survey ; and if unsurveyed, 
to be surveyed by the Government at the expense of the ap- 
plicant prior to the issuance of lease. Such surveys will be made 
under the regulations governing public land surveys, prior to 
the execution of which applicants will be required to deposit 
with the United States surveyor general the estimated expense 
thereof. 

3. Qualification of Applicants. 

Leases may be issued to {a) citizens of the United States, (b) 
associations of citizens, and (c) to corporations organized under 
the laws of the United States or of any State or Territory thereof. 

4. Minimum Development. 

An actual bona fide expenditure for mine operations, develop- 
ment or improvement purposes of the amount determined by 
the Secretary of the Interior will be a condition in each lease as 



LAND OFFICE REGULATIONS 379 

the minimum basis on which each lease will be granted, with 
the requirement that not less than one-third of such proposed 
investment shall be expended in development of the mine during 
the first year, and a like amount each year for the two succeeding 
years, the investment during any one year over such propor- 
tionate amount for that year to be credited on the expenditure 
required for the ensuing year or years. A bond executed by 
the lessee with approved corporate surety will be required to be 
furnished in the sum of $10,000, conditioned upon the expen- 
diture of the specified amount of investment. After said invest- 
ment has been made a similar bond in the sum of $5,000, con- 
ditioned upon compliance with the terms of the lease will be 
required. 

5. Minimum Production. 

Under the provision of the act requiring leases to be for inde- 
terminate periods upon condition of a minimum annual pro- 
duction after the first three years, except where interrupted by 
strikes, the elements or casualties not attributable to the lessee, 
each lease will contain appropriate conditions fixing such mini- 
mum production of phosphates or phosphate rock from the land. 

6. Application for Lease. 

Application for a lease must be under oath and filed in the 
proper district land office, addressed to the Commissioner of the 
General Land Office. No specific form is required and no blanks 
will be furnished, but the application should cover the follow- 
ing points : 

(a) Applicant's name and address. 

(b) Citizenship of applicant, whether native born or natural- 
ized; and if naturalized, furnish a certificate thereof in the form 
provided for use in public land matters, if one is not already 
on file in the Laud Department; if an association, citizenship 
of each member must be shown; if a corporation, furnish a 
certified copy of its articles of incorporation and a showing as 
to the residence and citizenship of its stockholders. 

(c) A statement that the applicant holds no lease of phosphate 



/ 

380 MORRISON'S OIL RIGHTS 

lands under said act within the State in which the land is 
situated; nor, as a member of an association or stockholder in 
a corporation, holds any interest or interests in any lease or 
leases of phosphate lands under said act, which, together with 
the lands applied for, exceed in the aggregate 2,560 acres. 

(d) Description of the land, whether vacant or unclaimed; if 
surveyed, by legal subdivisions; if unsurveyed, by metes and 
bounds, and where possible by the approximate subdivisions the 
land will be when surveyed. If the land is unsurveyed, a survey 
thereof at the expense of the applicant must be provided for 
prior to the execution of a lease thereof, as provided in section 
10 of the act. 

(e) Description of the phosphate deposits in the land, giving 
nature and extent thereof; the proposed method of mining and 
reduction of same ; and proposed investment in mining operations 
thereon and reduction facilities therefor if a lease be granted the 
applicant. 

7. Action by local office. 

Registers and receivers will assign current serial numbers 
to such applications when filed, promptly note their records, 
and require a notice of the application to be published at the 
expense of the applicant for a period of 30 days in a newspaper 
of general circulation in the county in which the deposits are 
situated, advising all adverse claimants or protestants that if 
they desire to object or protect any interest as against the ap- 
plicant, prompt action to that end should be taken, and upon 
proof of such publication, transmit the applications to the Gen- 
eral Land Office with report of record status of the land de- 
scribed therein. 

After receipt of such an application, no filing for any of the 
land described therein will be accepted until so directed, unless 
the application be rejected. 

8. Action on Application. 

Upon consideration of the application in the General Land 
Office, if the tracts of land or deposits are found subject to lease 



LAND OFFICE REGULATIONS 381 

and the application is otherwise satisfactory, a lease substantial^ 
in the form herewith will be submitted to the applicant for his 
execution. 

9. Action by Successful Applicant. 

The successful applicant will be allowed 30 days after receipt 
of the lease for execution within which to (a) file in the district 
office the lease duly executed by him in triplicate and in the 
form herein prescribed; (b) file evidence of citizenship and 
qualifications as required by paragraph 6 hereof, if not thereto- 
fore filed by him; (c) file the bond required by paragraph 2 b 
of the lease, or United States bonds in lieu thereof under the 
act of February 24, 1919 (40 Stat., 1148) ; and (d) pay the 
annual rental for the first year of the lease. 

10. Action by Local Office. 

At the end of the 30 days allowed the successful applicant, 
or sooner if the foregoing be complied with by him, the local 
officers will forward by special letter all papers with full report 
of action taken. 

11/ Form of Lease. 
Leases hereunder will be in substantially the following form : 



Land Office at 
Serial No. . . . 



The United States of America, Department of the Interior. 

MINING LEASE OF PHOSPHATE LANDS UNDER ACT 
OF FEBRUARY 25, 1920. 

Date. Parties. 

This indenture of lease, entered into, in triplicate, this 

day of , A. D. 19 — , by and between the United States of 

America, acting in this behalf by , Secretary 

of the Interior, party of the first part, hereinafter called the 



-SL' MORRISON'S OIL RIGHTS 

lessor, and of , party of the 

second part, hereinafter called the lessee, under, pursuant, and 
subject to the terms and provisions of the act of Congress, ap- 
proved February 25, 1920 (41 Stat., — ), entitled "An act to 
promote the mining of coal, phosphate, oil, oil shale, gas, and 
sodium on the public domain," hereinafter called the "act," 

Description of Land. Mining and Surface Rights. 

WITNESSETH : 

That the lessor, in consideration of the rents and royalties to 
be paid and the covenants to be observed as hereinafter set 
forth, does hereby grant and lease to the lessee the exclusive 
right and privilege to mine and dispose of all the phosphate and 
phosphate rock in, upon, or under the following described tracts 
of land, situated in the State of , to wit : 

containing acres, more or less, together with the right 

to construct all such works, buildings, plants, structures, and 
appliances as may be necessary and convenient for the mining 
and preparation of the phosphates for market, the manufacture 
of products thereof, the housing and welfare of employees, and, 
subject to the conditions herein provided, to use so much of the 
surface as may reasonably be required in the exercise of the 
rights and privileges granted. 

Rights Reserved by Lessor. Easements. 

Section 1. That the lessor expressly reserves: 
(la) The right to permit for joint or several use such ease- 
ments or rights of way, including easements in tunnels upon, 
through, or in the land leased, occupied, or used as may be 
.necessary or appropriate to the working of the same or other 
lands containing the deposits described in said act, and the 
treatment and shipment of the products thereof by or under 
authority of the Government, its lessees or permittees, and for 
other public purposes. 



LAND OFFICE REGULATIONS 383 

Disposition of Surface. 

(lb) The right to lease, sell, or otherwise dispose of the sur- 
face of said lands or any part thereof under existing law or laws 
hereafter enacted, in so far as said surface is not necessary for 
the use of the lessee in the mining and removal of the phosphates 
therein, and to lease other mineral deposits in the lands, under 
the provisions of said act. 

Monopoly and fair prices. 

(lc) Full power and authority to carry out and enforce all 
the provisions of section 30 of said act to insure the sale of the 
production of said leased lands to the United States and to the 
public at reasonable prices, to prevent monopoly, and to safe- 
guard the public welfare. 

Lessee's Covenants. 

Sec. 2. The lessee in consideration of the lease of the rights 
and privileges aforesaid hereby covenants and agrees as follows : 

Investment. 

(2 a) To invest in actual mining operations, development or 
improvements upon the land leased, or for the benefit thereof, 
the sum of dollars, of which sum not less than one- 
third shall be so expended during the first year succeeding the 
execution of this instrument and a like sum each of the two 
succeeding years, unless sooner expended ; and submit annually, 
at the expiration of each year for the said period, an itemized 
statement of the amount and character of said expenditure dur- 
ing such year. 

Bond. 

(2 b) To furnish a bond in the sum of $10,000, conditioned 
upon the expenditure of the amount specified herein (2 a), and 
after said investment has been made, a similar bond in the sum 
of $5,000, conditioned upon compliance with the terms and 
provisions of this lease. 



384 MORRISON'S OIL RIGHTS 

Annual Rental. 

(2 c) To pay as an annual rental for each acre or part thereof 
covered by this lease the sum of 25 cents per acre for the first 
year, payment of which amount is hereby acknowledged,. the sum 
of 50 cents per acre per year for the second, third, fourth, and 
fifth years, and $1 per acre for the sixth and each succeeding year 
during the life of this lease, all such annual payments of rental 
to be made to the receiver of the United States land office of the 
district in which said land is situated, on the anniversary of the 
date hereof, and to be credited on the first royalties to become 
due hereunder during the year for which said rental was paid. 

Royalty. 

(2d) To pay to such receiver a royalty of per cent 

(not less than 2 per cent) of the gross value of the output of 
phosphates or phosphate rock at the mine during the first 20 
years succeeding the execution of this lease. (Special provisions 
suited to operations under the lease may be here inserted if 
found necessary.) Royalties shall be payable quarterly within 
30 days from the expiration of the quarter in which the phos- 
phates are mined. 

Record of Phosphates Mined. 

(2e) To determine accurately the weight or quantity of all 
phosphates or phosphate rock mined from the leased premises, 
and to accurately enter the weight or quantity thereof in due 
form in books to be kept and preserved by the lessee for such 
purpose. 

Quarterly Reports. 

(2f) To furnish quarterly, within 30 days after the expira- 
tion of the quarter, a written report covering such quarter, 
certified under oath by the superintendent of the mine, or by 
such other agent having personal knowledge of the facts as may 
be designated by the lessee for such purpose, showing the amount 
of phosphates or phosphate rock mined during the' quarter, the 



LAND OFFICE REGULATIONS 385 

character and quality thereof, and amount of its products and 
by-products disposed of and price received therefor, and amount 
of phosphates or phosphate rock and its products in storage or 
held for sale. 

Annual Reports. 

(2 g) Also to furnish in such manner and form as may be 
prescribed by the lessor, at the end of each year, beginning on 
the first anniversary of the date of the lease, and at such other 
times as the lessor may require, a plat showing all development 
work and improvements on the leased lands, and other related 
information, with a report under oath as to all buildings, struc- 
tures, or other works placed in or upon said leased lands, ac- 
companied by a report in detail as to the stockholders, invest- 
ment, depreciation, and cost of operation, together with a state- 
ment as to the amount of phosphate or phosphate rock produced 
and sold, and the amount received therefor, by operations 
hereunder. 

Mine Maps. 

(2h) To keep at the mine office clear, accurate, and detailed 
maps, on a scale not more than 200 feet to the inch, in the form 
of horizontal projections on tracing cloth, of the workings in 
each phosphate bed in each separate mine on the leased lands, 
a separate map to be made for each such bed, and for the surface 
immediately over the underground workings, and to be so ar- 
ranged with reference to a public land corner that the maps can 
be readily superimposed. 

Progress Maps. 

Blue prints or reproductions in duplicate of the maps required 
as aforesaid shall be furnished the lessor when made, and sup- 
plemental prints or reproductions in duplicate furnished on or 
before the first day of each succeeding year, showing the ex- 
tensions, additions, and changes since the last map or supple- 
ment was submitted. All mine progress maps kept by the lessee 
shall at all times be subject to examination by lessor. 
M. O. R— 25. 



086 MORRISON'S OIL RIGHTS 

Minimum Production. 

(2 i) That, beginning' with the fourth year of the lease, except 
when such operation shall be interrupted by strikes, the elements, 
or casualties not attributable to the lessee, the lessee shall mine 

each year and pay a royalty thereon, not less than , 

tons of phosphate rock from the leased premises, unless opera- 
tions are suspended as provided in section 11 of the act. 

Assignment of Lease. 

(2 j) That the lessee shall not assign this lease or any interest 
therein, nor sublet any portion of the leased premises without 
the written consent of the lessor being first had and obtained. 

Readjustment of Terms. 

Sec. 3. It is mutually understood and agreed that the lessor 
shall have the right to readjust and fix the royalties payable 
hereunder and other terms and conditions including amount of 
minimum annual production, at the end of 20 years; from the 
date hereof, and thereafter at the end of each succeeding 20 
year period during the. continuance of this lease unless other- 
wise prbvided by law at the time of the expiration of any such 
period, but in case the lessee be. dissatisfied with the rate of 
royalty or other terms and conditions so fixed, he may terminate 
this lease in the manner and under the conditions provided in 
sections 6(b) and 6 ..(c) hereof. 

Provisions Controlled By State Laws. 

Sec. 4. This lease is made subject to the following, provisions, 
which the lessee accepts and covenants faithfully to perform and 
observe, unless the laws of the State where the leased land or 
deposits are situated otherwise .provides, in which case such 
State laws control : 

Operating Regulations. 

(4 a) The lessee shall carry out and observe regulations pre- 
scribed by the Secretary of the Interior and in force at the date 
hereof relative to (1) reasonable diligence, skill, and care in 
the operation of said property in accordance with approved 



LAND OFFICE KHrtCLATlONS 387 

methods and practices, (2) the prevention of undue waste, and 
(&j the safety and welfare of miners. 

Payment of Wages. Freedom of Purchase. Eight-hour work 
day. 

< (4 b) And also shall pay all miners and other employees, both 
above and below ground, at least twice each month in lawful 
money of the United States, and shall permit such miners and 
other employees full and complete freedom of purchase, but 
with a view to increasing safety this provision shall not apply to 
the purchase of explosives, detonators, or fuses; and shall not 
require or permit miners or other employees, except in case of 
emergency, to work underground for more than eight hours in 
any one workday, and shall not employ any boy under the age 
of 16 years or any girl or woman without regard to age in any 
mine below the surface. 

Inspection. 

Sec. 5. And the lessee also expressly agrees that all mining 
and related operations shall be subject to the inspection of 
authorized representatives of the lessor, and that such repre- 
sentatives may at all times enter into and upon the leased lands 
and survey and examine same and all surface and underground 
improvements, works, machinery, equipment, and operations. 

Examination of Books and Records. 

(5 a) And also shall permit the lessor to examine all books 
and records pertaining to operations under this lease and to 
make copies of and extracts from any or all of same, if desired. 

Operations on Adjoining Lands. 

(5 b) And also shall permit the lessor, or its lessees or trans- 
ferees, with the approval of the lessor, to make and use upon or 
under the leased lands any workings necessary for freeing any 
other mine from water or gas, or extinguishing fires, causing as 
little damage or interference as possible to or with the mine or 
mining operations of the lessee hereunder; Provided, That any 
such use by a transferee or another lessee shall be conditioned 



388 MORRISON'S OIL RIGHTS 

upon the payment to the lessee hereunder of the amount of 
actual damages sustained thereby and adequate compensation 
for such use. 

Result of Forfeiture. 

(5 c) And also shall, at the termination of this lease, as the 
result of forfeiture thereof, pursuant to paragraph (6d), de- 
liver up to the lessor the lands covered thereby* including all 
fixtures, machinery, improvements, and appurtenances, other 
than strictly personal property, situate on any of said lands, in 
good order and condition, so as to permit of immediate con- 
tinued operation to the full extent and capacity of the leased 
premises. 

Surrender or Forfeiture of Lease. Improvements. 

Sec. S. It is further mutually understood and agreed as fol- 
lows : 

(6 a) That the lessor may in writing waive any breach of the 
covenants and conditions contained herein except such as are 
required by the act, but any such waiver shall extend only to 
the particular breach so waived and shall not limit the rights of 
the lessor with respect to any future breach ; nor shall the waiver 
of a particular cause of forfeiture prevent cancellation of this 
lease for any other cause, or for the same cause occuring at 
another time. 

Surrender of Lease. 

(6 b) The lessee may, on consent of the Secretary of the In- 
terior first had and obtained, surrender and terminate this lease 
upon payment of all rents, royalties, and other debts due and 
payable to the lessor, and upon payment of all wages or moneys 
due and payable to the workmen employed by the lessee, and 
upon a satisfactory showing to the Secretary of the Interior 
that the public interest will not be impaired ; and the lessee may 
with like consent surrender any legal subdivision of the area 
included within the lease ; but in no case shall such termination 
be effective until the lessee shall have made provision for the 



LAND OFFICE REGULATIONS 38f) 

preservation of any mines or productive works or permanent im- 
provements on the lands covered hereby. 

Privilege of Purchasing Equipment. 

(6 c) That on the termination of this lease, pursuant to the 
last preceding paragraph, the lessor, his agent, licensee, or lessee 
shall have the exclusive right, at the lessor's election, to purchase 
at any time within six months, at the appraised value thereof, 
all building's, machinery, equipment, and tools, placed by the 
lessee in or on the land leased hereunder, save and except all 
underground timbering, and such other supports and structures 
as are necessary for the preservation of the mine, which shall 
be and remain a part of the realty without further consideration 
or compensation ; that the purchase price to be paid for said 
buildings, machinery, equipment, and tools to be purchased as 
aforesaid, shall be fixed by appraisal of three disinterested and 
competent persons (one to be designated by each party hereto 
and the third by the two so designated), the valuation of the 
three or a majority of them to be conclusive ; that pending such 
election to purchase within said period of six months none of 
said buildings or other property shall be removed from their 
normal position; that if such valuation be not requested, or the 
lessor shall affirmatively elect not to purchase within said period 
of six months, the lessee shall have the privilege of removing 
said buildings and other property, except said timbering and 
other supports and structures, as are necessary for the preserva- 
tion of the mine, as aforesaid. 

Forfeiture. 

(6 d) If the lessee shall fail to comply with the provision of 
the act or make default in the performance or observance of any 
of the terms, covenants, and stipulations hereof, or in the general 
regulations promulgated and in force at date hereof, the lessor 
may institute appropriate proceedings in a court of competent 
.-jurisdiction for the forfeiture and cancellation of this lease as 
provided in section 31 of the act, but this provision shall not be 
construed as depriving the lessor of any legal or equitable remedy 
which the lessor might otherwise have. 



-<90 MORRISON'S OIL RIGHTS 

Action by Lessor to Prevent Loss or Damage. 

Sec. 7. It is further covenanted and agreed that, should the 
lessee fail to take prompt and necessary steps to prevent loss or 
damage to the mine, property, or premises, or danger to the 
employees, the lessor may enter on the premises and take such 
measures as may be deemed necessary to prevent such loss or 
damage or to correct the dangerous or unsafe condition of the 
mine or works thereof, which shall be at the expense of the lessee. 

Continuing' Obligation. 

Sec. 8. It is further covenanted and agreed that each obliga- 
tion hereunder shall extend to and be binding upon, and every 
benefit hereof shall inure to, the heirs, executors, administrators, 
successors, or assigns of the respective parties hereto. 

Disqualified Parties. Penal Statutes. 

Sec. 9. It is also further agreed that no Member of or Dele- 
gate to Congress, or Resident Commissioner, after his election 
or appointment, or either before or after he has qualified, and 
during his continuance in office, and that no officer, agent or em- 
ployee of the Department of the Interior, shall be admitted to any 
share or part in this lease, or derive any benefit that may arise 
therefrom, and the provisions of section 3741 of the Revised Stat- 
utes of the United States and sections 114, 115, and 116 of the 
Codification of the Penal Laws of the United States approved 
March 4, 1909 (35 Stat. 1109), relating to contracts enter into 
and form a part of this lease so far as the same may be applicable. 

In witness whereof — 

The United States op America, 

By 

Secretary of the Interior, Lessor. 
Witnesses, 

Lessee . 

• • « • 'JL-'J 



LAND OFFICE REGULATIONS 391 

12. Use Permits for Additional Lands. 

Under section 12 of the act a lessee may be granted a right to 
use the surface of not exceeding 40 acres of unappropriated and 
unentered land as may be necessary for the proper prospecting 
tor or development, extraction, treatment, or removal of the 
phosphate deposits in the leased lands. 

Applications for permits for such additional tracts shall be 
filed in the district office having jurisdiction over the lands and 
should identify the lease' by the serial number under which is- 
sued, and be tiled under the same number. Such applications 
must be under oath and set forth the specific reasons why the 
additional tract is necessary to the lessee for the use named, 
described the land desired by legal subdivision if surveyed, and 
if unsurveyed, by the approximate description it will be when 
surveyed, and also set forth the reasons why the land is desirable 
and adapted to the uses named, either in point of location, topog- 
raphy, or otherwise, and that it is unoccupied and unappro- 
priated. 

FORM OF USE PERMIT UNDER SECTION 12. 



Land Office at 
Serial No. . . . 



The United States of America, 
Department of the Interior. 

Use Permit under Section 12, Act of February 25, 1920. 

Know all men by these presents, that the Secretary of the In- 
terior, under and by virtue of the act of Congress approved 
February 25, 1920, entitled "An act to promote the mining of 
coal, phosphate, oil, oil shale, gas, and sodium on the public do- 
main," hereby grants to , holder of lease bearing 

serial No , the exclusive right, so long as needed, used, 

and occupied during the life of the aforesaid lease, the use of 
the surface of the following described tract of land, to wit, .... 

for the proper prospecting for or development, extraction, treat- 



392 MORRISON'S OIL RIGHTS 

ment, or removal of the phosphate deposits covered by the afore- 
said lease, all rights hereunder to cease and terminate upon the 
termination of the aforesaid lease. 
Dated this day of , 19 . . . 



Secretary of the Interior. 



13. Repealing and Saving Clause. 

Section 37 of the act provides that hereafter the deposits of 
coal, phosphate, sodium, oil, oil shale, and gas referred to and de- 
scribed in the act may be disposed of only in the manner pro- 
vided by the act, "except as to valid claims existent at date of 
passage of this act, and thereafter maintained in compliance 
with the laws under which initiated, which claims may be per- 
fected under said laws, including discovery." As to phosphate 
claims, those claims initiated under the pre-existing law may go 
to patent which, at the date of the act, were valid mining loca- 
tions, duly made and maintained as such on lands subject to 
such location at the date initiated. 

14. Fees and Commissions. 

(a) For receiving and acting upon each application for lease 
filed in the district land office in accordance with these regu- 
lations, there shall be paid by the applicant a fee of $2 for 
every 160 acres or fraction thereof in the application, such fee 
in no case to be less than $10, the same to be considered as 
earned when paid, and to be credited in equal parts to the com- 
pensation of the register and receiver within the limitations pro- 
vided by law. 

(b) Registers and receivers shall be entitled to a commission 
of 1 per cent of all moneys received in each register's office, to 
be equally divided between the register and receiver. Such com- 
mission will not be collected from the applicant or lessee in 
addition to the moneys otherwise provided to be paid. 

It should be understood that the commissions herein provided 
for will not affect the disposition of the proceeds arising from 
operations under the act, as provided in section 35 thereof; also 



LAND OFFICE REGULATIONS 



393 



that such commissions will be credited on compensation of regis- 
ters and receivers only to the extent of the limitation provided 
by law for maximum compensation of such officers. 

Very respectfully, 

Clay Tallman, 
Commissioner. 
Approved May 22, 1920. 
John Barton Payne, 
Secretary of the Interior. 

The Phosphate sections of the Act, 9-12, call for leases but 
not for permits. The leases are to be granted upon competitive 
bidding after advertisement or by any other method adopted 
by the Land Office by general regulation, sec. 9. 

There are no limitations, either on the rental or on the royalty, 
which assumes that the lessee has not acquired any rights in the 
way of pre-emption until he obtains his lease. 

A permittee, where any kind of mineral permit is allowed, is 
supposed to be a prospector who, when successful under the 
permit, becomes entitled to a lease, but if there is no limit to 
the royalty in such promised lease, there is no reward to the 
prospector at all. If the phosphates had been located as placers, 
as they might have been under the law, such locations may be 
advanced to patent. If there be a location, valid, except as to 
discovery, it may be advanced to discovery and, after discov- 
ery to patent, under Section 37 ; but if there be no such inchoate 
right, a phosphate seeker must apply for Lease under the 1920 
Act. 

Rule 4 requiring an approved bond in $10,000 is an almost 
prohibitive requirement. These excessive demands do not abso- 
lutely deprive the prospector of all the benefit of his discovery 
but they do compel him to divide with the party furnishing the 
security. We know of no reasons which justify the imposition 
of any such condition. 

FORM OF APPLICATION FOR LEASE. 

To the Honorable Commissioner of the General Land Office : 
Your petitioner, George C. Hackstaff, respectfully represents : 



394 MORRISON'S OIL RIGHTS 

1. That his residence is in the City and County of Denver, 
State of Colorado, and that his address is number 63 Arapahoe 
Block, in said City of Denver. 

2. That he is a native-born citizen of the United States. 

3. The applicant holds no lease of phospate lands within the 
State of Oklahoma in which the land is situated, nor as a mem- 
ber of an association or a stockholder in a corporation does he 
hold any interest or interests in any lease or leases for phos- 
phate lands under the Leasing Act of 1920 exceeding, together 
with the land applied for, the aggregate of 2560 acres. 

4. The land applied for is vacant and unclaimed and is un- 
surveyed. It contains 320 acres, has been plainly marked and 
staked upon the ground and would probably fall within town- 
ship 1 South, Range West of the P. M. in Day 

County, State of Oklahoma. 

5. From the northeast corner of the claim, the north end of 
an island in the Canadian River bears north 45° east, distant 
about one mile. A large stone building, the property of and 
owned by Paul M. Segal, bears due east from said northeast 
corner about one mile distant and a large stake sunk two feet 
in the ground, six feet high and six inches square, scribed with 
the initials of the claimant, bears south 10° east, 100 feet from 
the said northeast corner. 

6. The applicant is prepared to pay the expenses of survey 
when fixed by the Department or the Surveyor General as re- 
quired by said Act. 

7. The phosphate deposits in the land show surface indiea 
tions of phosphate rock carrying 50 per cent, of Calcium Phos 
phate over an area of ten acres which has been exposed by two 
pits, each six feet deep. The proposed method of mining is by 
open face surface excavations and the proposed reduction of 
the ore is by treatment with sulphuric acid to produce the 
soluble phosphates used in the composition of commercial fer- 
tilizers. 

8. The proposed investment is by building a plant at an esti- 
mated cost of $5,000 under written contract with responsible 
parties, a copy of which will be furnished if requested by the 
Department (or a copy may be inclosed as an exhibit). 



LAND OFFICE REGULATIONS 395 

9. The tract upon which lease is prayed for is in compact 
form and its length docs not exceed two and one-half times its 
width, the tract running- due north and south 5280 feet and 
due east and west 2660 feet. 

Wherefore your petitioner prays that the amount of royalty 
and the acreage rental be specified as required by section 11 of 
said Act and that a lease be granted to your petitioner under 
and in conformity to the regulations of the Department in such 
case made and provided. 

George C. Ilackstaff. 

Verify as on page 313. 

Publishing" Notice of Application. 

Rule 7, above printed, says that upon filing petition such as 
above a notice will then be published at the applicant's expense 
requiring adverse claimants or protestants, if any, to appear. 
After proof of publication, the papers are to be forwarded to 
the General Land Office for action. 

The form of notice on page 404 for publication used in ease 
of a Sodium lease, should, with obvious changes fulfill the re 
quirements concerning this notice. 

As the applicant has no pre-emption rights and the rules do 
not require competitive bidding, it would seem that rule 7 is 
published under the phrase "such other methods as the Secre 
tary of the Interior may by general regulation adopt." 

Section 11 requires that the royalties be fixed in advance of 
offering the same which must certainly mean before the notice 
is published. The prayer in the above form, it will be noted, 
is that such royalties be fixed. The rules evidently treat the 
petitioner as having pre-emption rights as they do not require 
competitive bidding but do require a protest or adverse claim. 
The disagreement between the rule and the section cited is ap- 
parent but doubtless the local land office would hold the appli- 
cation until the rents and royalties were fixed or further regu- 
lations may make the practice more clear. 



396 MORRISON'S on, RIGHTS 

CIRCULAR NO. 699, 

Department of the Interior, 

General Land Office, 
Washington, D. C, May 28, 1920, 

SODIUM REGULATIONS. 

Permits Authorizing Exploration of Public Lands for Sodium. 

# 
Registers and receivers, United States land offices: 

Sirs: The Act of Congress approved February 25, 1920, 
entitled "An Act to promote the mining of coal, phosphate, oil, 
oil shale, gas, and sodium on the public domain" (Public No. 
146), authorizes the Secretary of the Interior, under such rules 
and regulations as he may prescribe, to issue prospecting per- 
mits, for a period not to exceed two years, for the exploration 
of the land described therein for sodium in any of the forms 
named in said act, and under authority thereof the following 
rules and regulations will govern the issuance of such permits: 

1. Qualifications of Applicants. 

Permits may be issued to (a) citizens of the United States, 
(6) an association of such citizens, (c) or a corporation organized 
under the laws of any State or Territory thereof, 

2. Lands to Which Applicable. 

The permit thus issued may include not more than 2,560 acres 
of public lands of the United States in reasonably compact form, 
by legal subdivisions if surveyed; if unsurveyed, by metes and 
bounds description. 

3. Rights under Permit. 

The permit will confer upon the recipient the exclusive right 
to prospect for chlorides, sulphates, borates, silicates, or nitrates 
of sodium, dissolved in and soluble in water, and accumulated 
by concentration, on the lands embraced therein. In the exercise 



LAND OFFICE REGULATIONS 397 

of this right the permittee shall be authorized to remove from 
the premises only such material as may be necessary to experi- 
mental work and the demonstration of the existence of such de- 
posits or any of them in commercial quantities. 

4. Reward for Discovery. 

If the permittee within the two years specified shall discover 
valuable deposits of one or more of the forms of sodium as de 
scribed in said act within the area covered, by his permit, such 
discovery shall entitle him to a lease of one-half the land em- 
braced in the permit, to be taken in compact form. The dis- 
covery of a valuable deposit of sodium under this permit shall 
be construed as the discovery of a deposit which yields commer 
«.'ial sodium in commercial quantities. 

The remainder of the land embraced in such permit, if con 
taming deposits of sodium, will thereafter become subject to 
lease, under such regulations as may be found requisite in deal 
ing with the land containing said deposit, the permittee having 
a preference right to lease such remainder. 

5. Camp Sites. 

In addition to land embraced in the permit, the Secretary 
may, in his discretion, issue to the permittee, during the life 
of the permit, the exclusive right to use a tract of unoccupied,. 
nonmineral public land, not exceeding 40 acres in area, for pur- 
poses connected with and necessary to the development of the 
deposits covered by the permit, subject to the payment of an 
annual rental of not less than 25 cents per acre. 

6. Form and Contents of Application. 

Applications for permits should be tiled in the proper dis- 
trict land office, addressed to the Commissioner of the General 
Land Office, and after due notation promptly forwarded for his 
consideration. No specific form of application is required, but 
it Should cover, in substance, the following points, namely: 

(a) Applicant's name and address. 

(b) Proof of citizenship of applicant; by affidavit of such 



398 MORRISONS OIL RIGHTS 

fact, if native born ; or, if naturalized, by the certificate thereof 
or affidavit as to time and place when issued; if a corporation, 
by certified copy of the articles thereof. 

(c) Description of land for which the permit is desired, by 
legal subdivisions, if surveyed, and by metes and bounds, if 
unsurveyed, in which latter case, if deemed necessary, a sur- 
vey sufficient more fully to identify and segregate the land may 
be required before the permit is granted; also a statement 
whether the land is vacant and unclaimed. 

(d) Reasons why the land is believed to offer a favorable field 
for prospecting. 

(e) Proposed method of conducting exploratory operations, 
amount of capital available for such operations, and the dili- 
gence with which such explorations will be prosecuted. 

(/) Statement of the applicant's experience in operations of 
this nature, together with references as to his character, repu- 
tation, and business standing. 

7. On the receipt of the application, if found in compliance 
with the terms of the act, a permit will issue and the district 
land officers be promptly notified thereof. 

8. Form of Permit. 

The form of permit issued under this act will be in substance 
as follows: 

The United States of America, 

Department of the Interior, 

Sodium Prospecting Permit. 

Know all men by these presents, that the Secretary of the 
Interior, under and by virtue of the act of Congress entitled 
"An act to promote the mining of coal, phosphate, oil, oil shale, 
gas, and sodium on the public domain," approved February 25> 

1920, has granted and does hereby grant a permit to 

of the exclusive right for a period of two 

years from date hereof to prospect the following described lands 



LAND OFFICE REGULATIONS 399 



for chlorides, sulphates, carbonates, 

borates, silicates, or nitrates of sodium, dissolved in and soluble 
in water, and accumulated by concentration, but for no other 
purpose, upon the express conditions as follows, to wit : 

1. To begin the prospecting for said minerals within ninety 
days from date hereof and to diligently prosecute the explora- 
tion and experimental work during the period of such permit, in 
the manner and extent as follows, to wit: 

2. To remove from said premises only such material as may 
be necessary to experimental work and the demonstration of 
the existence of such deposits in commercial quantities. 

3. To afford all facility for inspection of such exploratory 
work on behalf of the Secretary of the Interior, and to report 
fully when required all matters pertaining to the character, 
progress, and results of such exploratory work, and to that end 
to keep and maintain such accounts, logs, or other records, as 
the Secretary of the Interior may require. 

4. Not to assign or transfer the permit granted hereby with- 
out the express consent in writing of the Secretary of the In- 
terior. 

Expressly reserving to the Secretary of the Interior the right 
to permit for joint or several use such easements or right of way 
upon, through or in the lands covered hereby, as may be neces- 
sary or appropriate to the working of the same, or of other lands 
containing the deposits described in said act ; and further reserv- 
ing the right and authority to cancel this instrument for failure 
of the permittee or licensee to exercise due diligence in . the exe- 
cution of the prospecting work in accordance with the terms 
hereof. 

Valid existing rights, acquired prior hereto, on the lands de- 
scribed herein, will not be affected hereby. 

In witness whereof I have affixed my signature hereto and 
the seal of the Department this day of , 19 . . . 



Secretary of the Interior, 



400 MORRISON'S OIL RIGHTS 

II. 

Regulations Pertaining to Leases for Lands Containing 

Sodium. 

The Act of February 25, 1920 (Public No. 146), in section 
24, authorizes the Secretary of the Interior, under such general 
regulations as he may adopt, to lease, for the production of the 
sodium and other mineral deposits contained therein, public 
lands, except those in San Bernardino County, California : 

A. Known to contain sodium in commercial quantity and char- 
acter and found in some or any of the forms described in said 
act. 

B. Embraced in any permit, under which the existence of such 
deposits has been demonstrated, but not included in the lease 
awarded to the permittee, and by virtue of such authority the 
following regulations are hereby prescribed : 

1. Qualifications of Applicants. 

Applications for leases in the form as herein provided may be 
filed in the proper district land office, addressed to the Commis- 
sioner of the General Land Office for any land in classes A and 
B, by citizens of the United States, an association of such citi- 
zens or corporations organized under the laws of any State or 
Territory thereof; the qualifications of the applicant in this re- 
spect to be fully covered by the application. 

2. Area and Description. 

Leases are authorized by the terms of the act for an area not 
exceeding 2,560 acres, but will be granted only for such area 
as may be shown to the satisfaction of the Secretary of the In- 
terior to contain deposits of sodium, in such form and quantities 
as to constitute a commercial value, and will be limited to lands 
reasonably compact in form and described by legal subdivisions 
of the public land surveys, if surveyed, or if unsurveyed, by the 
approximate description they will bear when surveyed ; the sur- 
vey in the latter case to be made at the expense of the applicant 
if the application for lease is otherwise found satisfactory, the 



LAND OFFICE REGULATIONS 40 L 

descriptions of the land in the lease when granted to conform 
to the official survey. 

3. Action by Register and Receiver. 

Applications when filed with the district land office will be 
given the current serial number, promptly noted of record and 
transmitted to the Commissioner of the General Land Office, ac- 
companied by a statement as to the status of the lands em- 
braced therein. After the receipt of such applications, no appli- 
cations, filings, or selections for the lands embraced therein will 
be permitted until so directed; except applications for leases 
under this act. 

4. Notice of Application. 

When an application for a lease is filed in the district land 
office, notice thereof shall be published at the expense of the 
applicant in a general newspaper to be designated by the regis- 
ter, published in the' county where the lands are situated, describ- 
ing the lands embraced therein, stating the purpose of the appli- 
cation and that it will be submitted to the Commissioner of the 
General Land Office for action within thirty days from the date 
fixed therein, advising all adverse claimants or protestants that 
if they desire to object or protect any interest as against the 
application, prompt action to that end should be taken ; and fur- 
her advising the public that any other applications for lease of 
the same lands may be filed at any time during said period of 
publication without publication of notice of said second or fur- 
ther application, in which case applications so filed will be con- 
sidered as prescribed in section 5 hereof. Proof of publication 
will be required prior to action by the commissioner on the ap- 
plication for lease. 

5. Action in General Land Office. 

On the receipt of the application or applications in the Gen- 
eral Land Office, the same will be considered, investigation made 
if deemed necessary, and submitted to the Secretary of the In- 
terior with appropriate recommendation and report as to the 
M. O. R.— 26. 



402 MORRISON'S OIL RIGHTS 

proper action to be taken thereon, giving due consideration to 
the proposed effectual development of the alleged sodium de- 
posits, and the amount of capital to be invested therein; the 
award of priority in case of conflicting applications to be deter- 
mined by the respective proposed investments, date of productive 
development proposed by the several applicants, and any equi- 
ties that may exist in one or more of the applicants resulting 
from improvement or development under claims made under 
other laws. 

6. Lease by Permittee. 

The permittee for lands in class B has a preference right with- 
in the two years of his permit to file application to lease any 
or all of the land included in his permit, upon showing to the 
satisfaction of the Secretary of the Interior that he has discov- 
ered a valuable deposit of sodium thereon. Any lands not leased 
by the permittee will be subject to be leased by others under the 
terms set forth in sections 3, 4, and 5 of these regulations. 

• 

7. Verity of Statements. 

The verity of all representations contained in applications for 
leases shall be deemed an essential thereto, and a moving con- 
sideration to the award of a lease, if such action is taken; mis- 
representations in this respect will be treated as a proper ground 
for proceedings in forfeiture, as provided in section 31 of the 
act. 

8. Lease a Waiver of Other Claims. 

The acceptance of a lease, under the provisions of this Act will 
be construed as a waiver and relinquishment of all claims on 
the part of the applicant for any lands embraced within said 
lease and claimed under the provisions of any other law. 

9. Form and contents of Application. 

Applications for leases must be under oath, and should be 
filed in the proper district land office, addressed to the Commis- 



LAND. OFFICE REGULATIONS 403 

sinner of the General Land Office. No specific form of applica- 
tion is required, and no blanks will be furnished, but it should 
cover in substance the following points: 

(a) .Applicant's name and address. 

(b) Proof of citizenship of applicant, by affidavit Of such fact, 
if native, born ; if naturalized, by a certified copy of a certificate 
thereof in the form provided for use in public land matters r 
unless such copy is on file. If the applicant is an association, 
each member thereof must show his qualifications as above stated ; 
if a corporation, a certified copy of the articles of incorporation 
must be filed, together with a showing as to the residence and 
citizenship of its stockholders. 

(c) A statement that the applicant has no lease under the 
provisions of this section, nor any other application for lease 
thereunder pending, and that he does not hold interests in such 
leases or applications which, with the land applied for, will ex- 
ceed 2,560 acres in the same State. 

(d) Description of land for which the lease is desired, by legal 
subdivisions if surveyed, and by metes and bounds if unsur- 
veyed, in which latter case the description should be connected 
to some corner of the public land surveys where practicable, or 
to some permanent landmark. If the land is unsurveyed, the 
applicant, after he has been awarded the right to a lease, but 
before the issuance thereof, will be required to deposit with the 
United States surveyor general of the State where the land is 
located the estimated cost of making a survey of the lands, any 
balance remaining after the work is completed to be returned. 
This survey will be an extension of the public land surveys over 
the tract applied for, the leased land to be conformed to legal 
subdivisions of such survey when made. 

(e) Evidence that the land is valuable for its sodium con- 
tent, except so much thereof as is necessary for the extraction 
and reduction of the leased minerals, with a statement as accurate 
as may be of the character and extent and mode of occurrence 
of the sodium depostis in the lands applied for. 

(/) Proposed method, so far as determined, as to the process 
of mining and reduction to be adopted, the diligence with which 
such operations will be carried on, and the contemplated invest- 



404 MORRISON'S OIL RIGHTS 

merit in reduction works and development, and the capital avail- 
able therefor. 

(g) The application shall be accompanied by a notice for pub- 
lication, in duplicate, prepared for the signature of the register, 
in substantially the following form : 

Serial No 

Department of the Interior, 

XL S. Land Office at , 

• ..,,19.,, 

Notice of Application for Sodium Lease. 

Notice is hereby given that in pursuance of the act of Con- 
gress, approved February 25, 1920, , whoso 

post office address is , has made applica- 
tion for sodium lease covering the following described lands: 



Any and all persons claiming adversely any of the above 
described lands are required to file their claims in this office on 
or before . , , otherwise their claims will be dis- 
regarded in the granting of such lease. 

. » ., Register. 

The register will fix the time within which adverse or con- 
flicting claims may be filed at not less than 30 nor more than 
40 days from first publication. 

10. Disposition of application. 

{a) The application will be given the current serial number 
by the register and receiver, noted on their records, and the no 
tice for publication will be signed by the register. 

(b) One copy of the signed notice will be delivered to the 
applicant, who will cause the same to be published in a news- 
paper to be designated by the register, of general circulation, and 
best adapted to give the widest publicity in the county where 
the land is situated. If the land is in two or more counties, 
notice must be published in each. Notice must also be posted in 
the local land office during the period of publication. 



LAND OFFICE REGULATIONS 405 

(c) At the expiration of the period of publication the evidence 
of publication and posting in said office should be promptly 
transmitted by the register and receiver to the Commissioner 
of the General Land Office, with a statement of the status of 
ilie land involved as to conflicts, withdrawals, protests, and any 
other matters that maj r be necessary to determine the availability 
of the land or deposits therein for lease. 

11. Form of lease. 

Serial No 

Department of the Interior, 
U. S. Land Office at 



Sodium Lease. 

Date — Parties.— This, indenture of lease entered into in tripli- 
cate this day of , 19 , by and 

between the United States of America, acting in this behalf by 

; , Secretary of the Interior, party of 

the first part, hereinafter called the lessor, and , 

, party of the second part, hereinafter called the 

lessee, under, pursuant, and subject to the terms and provisions 
of the act of Congress approved February 25, 1920 (Public No, 
146), entitled "An act to promote the mining of coal, phosphate, 
oil, oil shale, gas, and sodium on the public domain/' hereinafter 
referred to as the act, which is made a part hereof, witnesseth: 

Sec. 1. Purposes. 

That the lessor, in consideration of the rents and royalties to 
be paid, and the covenants to be observed as herein set forth, 
does hereby grant and lease to the lessee the exclusive right and 
privilege to mine, remove, and dispose of all the sodium and 
other minerals in, upon, or under the following-described tracts 

of land situated in the County of , State of 

, and more particularly described as 

follows, to-wit : , containing 

acres, more or less, together with the right to construct 

and maintain thereupon all works, buildings, plants, waterways, 



406 MORRISON'S OIL RIGHTS 

or reservoirs necessary to the full enjoyment hereof, together 
also with the right to use any timber, stone, or other materials 
on said land in connection with the operations to be conducted 
hereunder, for an indeterminate period, upon condition that at 
the end of each twenty-year period succeeding the date hereof 
such readjustment of terms and conditions may bo made as the 
party of the first part may determine • provided, that this lease 
shall extend only to or include any right or interest in the lands, 
or the minerals therein, reserved to the United States under 
any entry that may be allowed, or patent that may issue, or 
may have issued, with a reservation of minerals to the United 
States. 

Sec. 2. Covenants of Lessee. 

" In consideration of the foregoing the lessee hereby agrees : 

(a) To invest in actual development, or improvements, upon 

the land leased, or for the benefit thereof, the sum of 

dollars, of which sum not less than one-third shall be so expended 
during the first year succeeding the execution of this instru- 
ment and a like sum each of the two succeeding years, unless 
sooner expended ; and submit annually, at the expiration of each 
year for the said period, an itemized statement of the amount 
and character of said expenditure during such year. 

To furnish a bond in the sum of $10,000, conditioned upon 
the expenditure of the amount specified in (a) hereof, and after 
said investment has been made, a similar bond in the sum of 
$5,000, conditioned upon compliance with the terms and pro- 
visions of this lease. 

(b) Royalty. — To pay a royalty of ,.. per cent (not 

less than 12^ per cent) of the amount or value of the produc- 
tion of the lands leased. 

(c) Bents. — To pay the receiver of the district land office on 
all leases annually, in advance, beginning with the date of the 
execution of the lease, the following rentals: Fifty cents per 
acre for the first calendar year or fraction thereof; and one dol 
lar per acre for each and every calendar year thereafter during 
the continuance of the lease, such rental for any year to be 
credited against the royalties as they accrue for that year. 



LAND OFFICE REGULATIONS 407 

(d) Taxes. — To pay when due all taxes assessed and levied 
under the laws of the State upon the improvement, output of 
mines, or other rights, property, or assets of the 'lessee. 

(e) Monthly statements. — To furnish monthly certified state- 
ments in detail in such form as may be prescribed by the lessor 
of the amount and value of output from the leasehold as a basis 
for determining amount of royalties. All books and accounts 
of the lessee shall be open at all .times for the inspection by any 
duly authorized officer of the department. Falsification of such 
statements shall be a basis for action for the cancellation of the 
lease. : : . .. 

(/) Plats and imports. — To furnish annually a plat in the 
manner and form prescribed by the Secretary of the Interior 
showing all prospect and development work on the leased lands, 
and other related information, with a report as to all buildings, 
structures, or other works placed in or upon said leased lands, 
or on lands covered by permit issued under section 25 of the 
act, as well as any buildings, reduction works, or equipment, 
situated elsewhere and owned or operated in conjunction with, 
or as a part of, the operations conducted hereunder, accompanied 
by a report, in detail, as to the stockholders, business transacted, 
assets and liabilities of the lessee, together with a statement of 
the amount of sodium, and other minerals produced and secured 
by operations hereunder, and the cost of production thereof. 

(g) (Sodium in solution. — Where the minerals are taken from 
the earth in solution, such extraction shall not be within five 
hundred feet of the boundary line of leased lands without per- 
mission from the Secretary of the Interior. 

(h) Diligence — Prevention of waste — Health and safety of 
workmen. — To develop and produce in commercial quantities, 
with reasonable diligence, the sodium and other mineral deposits 
susceptible of such production in the lands covered hereby; to 
carry on all mining, reducing, refining, and other operations, in 
a good and workmanlike manner in accordance with approved 
methods and practice, having due regard to the health and safety 
of miners and other employees, the prevention of waste and the 
preservation and conservation of the property for future pro- 
ductive operations, observing all State laws relative to the health 



408 MORRISON'S OIL RIGHTS 

and safety of such workmen and employees, all mining and re- 
lated productive operations to be subject to the inspection of 
the lessor. 

(i) Forfeiture of lease. — To deliver up to the lessor on the 
termination of this lease, as a result of forfeiture thereof pursu- 
ant to section 31 of the act, the lands covered thereby, together 
with any land permission for the use of which has been granted 
under and pursuant to the provisions of section 25 of said act, 
including all fixtures, improvements, and appurtenances, other 
than machinery, tools, and personal property located and used 
above ground, situate on any of said lands, in good order and 
condition, so as to permit of immediate continued operation to 
the full extent and capacity of the leased premises: Provided, 
That on such forfeiture the lessor, his agent, licensee, or lessee 
shall have the exclusive right, at the lessor's option and at any 
time within six months from such forfeiture, to purchase such 
machinery, tools, and personal property and employees, all min- 
ing and related productive operations to be determined in the 
manner prescribed in section 5 of this lease. (Sic.) 

(k) Reserved deposits. — To comply with all statutory require- 
ments where the surface of the lands embraced herein has been 
disposed of under laws reserving to the United States the min- 
eral deposits therein. 

(I) Assignment. — Not to assign or sublet, without the consent 
of the Secretary of the Interior, the premises covered hereby. 

(m) Excess holdings. — To observe faithfully, the provisions of 
section 27 of the act whereunder this lease is executed, as to the 
interest or interests that may be taken or acquired under leases 
authorized by said act. 

(n) Minimum, production. — Beginning with the fourth year 
of the lease, except when operations are interrupted by strikes, 
the elements, or casualties not attributable to the lessee, to pro- 
duce each year and pay the royalty thereon of not less than 

tons of sodium, in some of the forms specified herein 

from the premises covered hereby. 

Sec. 3. The lessor expressly reserves : 

{a) Easements and rights of way. — The right to. permit for 



LAND OFFICE REGULATIONS 409 

joint or several use such easements or rights of way upon, 
through, or in the lands hereby leased, occupied, or used as may 
be necessary or appropriate to the working of the same, or of 
other lands containing the deposits described in this act; and 
the treatment and shipment of the products thereof, by or under 
authority of the Government, its lessees or permitees, and for 
other public purposes. 

(b) Disposition of surface. — The right to dispose of the sur- 
face of the land embraced herein under existing law, or laws 
hereafter enacted, in so far as said surface is not necessary for 
use of the lessees in extracting and removing the deposits therein. 

(c) Monopoly and fair pries. — Full power and authority to 
carry out and enforce all the provisions of section 30 of said 
act to. insure the sale of the production of said leased lands to 
the United States and to the public at reasonable prices, to pre- 
vent monopoly, and to safeguard the public welfare. 

Sec. 4. Surrender and Termination of Lease. 

The lessee may, on consent of the Secretary of the Interior 
first had and obtained, surrender and terminate this lease at any 
time after the first four years of the term herein provided for, 
by giving six months' notice in writing to the lessor, and upon 
payment of all rents, royalties, and other debts due and payable 
to the lessor, and upon payment of all wages or moneys due and 
payable to the workmen employed by the lessee, and upon a 
satisfactory showing to the Secretary of the Interior that the 
public interest will not be impaired; but in no case shall such 
termination be effective until the lessee shall have made pro- 
vision for the preservation of any mines or productive works or 
permanent improvements on the lands covered by such relin- 
quishment. 

Sec. 5. Purchase of Materials, Etc., on Termination of Lease. 

That on the termination of this lease, pursuant to the last 
preceding section, the lessor, his agent, licensee, or lessee, shall 
have the exclusive right, at the lessor's election, to purchase at 
any time within six months, at the appraised value thereof, all 



410 MORRISON'S OIL RIGHTS 

buildings, machinery, equipment and tools, whether fixtures or 
personalty, placed by the lessee in or on the land leased here- 
under, or on lands covered by permit under section 25 of the 
act, save and except underground improvement, machinery, 
equipment, or structures, which shall be and remain a part of 
the realty without further consideration or compensation; that 
the purchase price to be paid for said buildings, machinery, 
equipment, and tools to be purchased as aforesaid shall be fixed 
by appraisal of three disinterested and competent persons (one 
to be designated by each party thereto and the third by the 
two so designated), the valuation of the three or a majority of 
them to be conclusive; that pending such election to purchase 
within said period of six months none of said buildings, or other 
property, shall be removed from their normal position; that if 
such valuation be not requested, or the lessor shall affirmatively 
elect not to purchase within said period of six months, the lessee 
shall have the privilege of removing said buildings and other 
property except said underground equipment and structures as 
aforesaid. 

Sec. 6. Judicial Proceedings in Case of Default. 

If the lessee shall fail to comply with the provisions of the 
act, or make default in the performance or observance of any 
of the terms, covenants, and stipulations hereof, or of the gen- 
eral regulations promulgated and in force at date hereof, and 
such default shall continue for ninety days after service of 
written notice thereof by the lessor, then the lessor may insti- 
tute appropriate proceedings in a court of competent jurisdic- 
tion for the forfeiture and cancellation of this lease as provided 
in section 31 of the Act. A waiver of any particular cause of 
forfeiture shall not prevent the cancellation and forfeiture of 
this lease for any other cause of forfeiture, or for the same cause 
occurring at any other time. 

Sec. 7. Heirs and Successors in Interest. 

It is further agreed that each obligation hereunder shall extend 
to and be binding upon, and every benefit hereof shall inure to, 



LAND OFFICE REGULATIONS 411 

the heirs, executors, administrators, successors, or assigns of the 
respective parties thereto. 

Sec. 8. Unlawful Interest. 

It is also further agreed that no Member of or Delegate to 
Congress, or Resident Commissioner, after his election or ap- 
pointment, or either before or after he has qualified, and during 
his continuance in office, and that no officer, agent, or employee 
of the Department of the Interior, shall be admitted to any share 
or part of this lease, or derive any benefit that may arise there- 
from, and the provisions of section 3741 of the Revised Statutes 
of the United States, and sections 114, 115, and 116 of the Codi- 
fication of the Penal Laws of the United States, approved March 
4, 1909 (35 Stat., 1109), relating to contracts, enter into and 
form a part of this lease so far as the same may be applicable. 

In witness whereof— 

The United States of America, 

By 

Secretary of the Interior, Lessor. 

, Lessee. 

, Lessee. 

, Lessee. 

Witnesses : 



III. 

Use Permits for Camp Site and Refining Works. 

Section 25 of the Act of February 25, 1920, "to promote the 
mining of coal, phosphate, oil, oil shale, gas, and sodium on thf 
public domain," provides : 

"That in addition to areas of such mineral land which may be 
included in any such prospecting permits or leases the Secretary 
of the Interior, in his discretion, may grant to a permittee or 
lessee of lands containing sodium deposits, and subject to the 



412 MORRISON'S OIL RIGHTS 

payment of an annual rental of not less than 25 cents per acre, 
the exclusive right to use, during the life of the permit or lease, 
a tract of unoccupied nonmineral public land not exceeding forty 
acres m area for camp sites, refining works, and other purposes 
connected with and necessary to the proper development and 
use of the deposits covered by the permit or lease." 

In accordance with the provisions of this section the follow- 
ing regulations are prescribed, by which a permittee or lessee 
under the act may acquire the right therein granted. 

1. Application may be made by the permittee or lessee identi- 
fying by serial number his permit or lease, setting forth in detail 
the specific reasons why it is necessary for the applicant to have 
the use of an additional tract of land for a camp site, refining 
works, or other purposes, connected with and necessary to the 
proper development and use of the deposits covered by the per- 
mit or lease. 

2. The application should contain a description of the lands 
by legal subdivisions, if surveyed, or, if not surveyed, by the 
approximate description thereof as it will appear when sur- 
veyed, for which the right of use is desired, together with a 
statement of the particular reasons why it is especially adapted 
thereto, either in point of location, topography, or otherwise, and 
that it is unoccupied, nonmineral land. 

3. Use permits granted hereunder will be for indeterminate 
periods, dependent in that respect upon the existence of the per- 
mit or lease made the basis of the right authorized by section 
25; upon the termination of such permit or lease all rights se- 
cured hereby will also cease and terminate, and such condition 
shall be expressly recognized and stated in the application. 

4. No blank forms of application will be furnished to appli- 
cants hereunder, but they will be guided by the foregoing as 
to the essential requirements of the application, which will be 
verified by the affidavit of the applicant. 

5. The rental of not less than 25 cents per acre must be paid 
the receiver of the proper local land office as soon as applicant 
is notified of the allowance of the permit, and a like sum each 
year thereafter in advance. 



LAND OFFICE REGULATIONS 413 

IV. 

Form of Use Permit for Camp Site or Refining Works. 

The form of use permit issued under section 25 of the Act of 
February 25, 1920, will be in substance as follows: 

The United States of America, 

Department of the Interior. 

Use Permit. 

Know all men by these presents, that the Secretary of the 
Interior, under and by virtue of section 25 of the act of Con- 
gress entitled "An Act to promote the mining of coal, phosphate, 
oil, oil shale, gas, and sodium, on the public domain," approved 
February 25, 1920, has granted to and does hereby grant to 

. , the holder of , bearing serial 

number the exclusive right, so long as needed, 

used, and occupied, to use, during the life of the aforesaid 

. . . , the following-described tract of land, 

to wit : for a camp site, refining 

works, and other purposes connected with and necessary to the 
proper development and the use of the deposits covered by the 

aforesaid , all rights hereunder to cease 

and terminate upon the termination of the aforesaid 

, and conditioned upon the payment in advance 

of 25 cents per acre for the area covered hereby. 

In witness whereof I have affixed my signature hereto and the 

seal of the department this day of 

.......19... 



Secretary of the Interior. 

V. 

Repealing Clause, Etc. 
Repealing and Saving Clause. 

Section 37 of the Act provides that hereafter the deposits of 



414: MORRISON'S OIL RIGHTS 

coal, phosphate, sodium, oil, oil shale, and gas referred to and 
described in the act may be disposed of only in the manner pro- 
vided by the act, "except as to valid claims existent at date of 
passage of this act, and thereafter maintained in compliance 
with the laws under which initiated, which claims may be per- 
fected under said laws, including discovery." As to sodium 
claims, those claims initiated under the pre-existing law may 
go to patent which, at the date of the act, were valid mining 
locations, duly made and maintained as such on lands subject to 
such location at the date initiated. 

Fees and Commissions. 

(a) For receiving and acting upon each application for pros- 
pecting permit or lease filed in the district land office in accord- 
ance with these regulations, there shall be paid by the applicant 
a fee of $2 for every 160 acres or fraction thereof in the appli- 
cation, such fee in no case to be less than $10, the same to be 
considered as earned when paid and to be credited in equal parts 
to the compensation of the register and receiver within the limi- 
tations provided by law. 

(b) Registers and receivers shall be entitled. to a commission 
of 1 per cent of all moneys received in each register's office, to 
be equally divided between the register and receiver. Such com- 
mission will not be collected from the applicant or lessee in addi- 
tion to the moneys otherwise provided to be paid. 

It should be understood that the commissions herein provided 
for will not affect the disposition of the proceeds arising from 
operations under the act, as provided in section 35 thereof ; also 
that such commissions will be credited on compensation of regis- 
ters and receivers only to the extent of the limitation provided 
by law for maximum compensation of such officers. 

Very respectfully, 

Clay Tallman, 
Commissioner. 
Approved May 28, 1920. 
John Barton Payne, 
Secretary of the Interior. 



LAND OFFICE REGULATIONS 415 



FORM OP APPLICATION FOR SODIUM PERMIT. 

To the Hon. Commissioner of the General Land Office : 
Your petitioner, Edward T. Noland, respectfully represents: 

1. That his Post Office address is No. 624 Charles Block City 
and County of Denver, Colorado. 

2. That he is a native born citizen of the United States. 

3. That the land for which he desires a permit is Section 27 
Township 3, South, Range 17 west in Sevier County, State of 
Utah containing 640 acres, which land is vacant or unclaimed 
(or that said section has been filed upon by four locations as 
valuable placer mining ground but that the annual labor has 
not been kept up by the locators who have long since abandoned 
the same, or otherwise according to the facts). 

4. That the reasons why the ]and is believed to offer a favora- 
ble field for prospecting are : that there are indications of sodium 
values on the surface and that frequent attempts have been made 
by prospectors to discover valuable deposits but so far without 
substantial success for want of sufficient development. 

5. As to the proposed method for conducting exploratory 
operations, your petitioner says that he has $500 available for 
such operations and that he has already contracted with com 
petent miners to do $200 worth of work on the premises, by driv- 
ing a tunnel at a point which would cut the supposed sodium 
deposit within one hundred feet and will prosecute the driving 
of such tunnel to the -point where such deposits should be struck. 

6. That your petitioner has had no previous experience in 
operations of this nature. 

7. Exhibit A hereto attached contains references to responsible 
parties as to petitioner's character, reputation and business 
standing with the addresses of such parties. 

Your petitioner therefore applies for a sodium prospecting 
permit for the period of two. years under the terms of Section 
23 of the Act to promote the mining of coal, phosphate, oil, oil 
shale, gas and sodium on the public domain, approved Feb. 25, 



416 MORRISON'S OIL RIGHTS 

1920 and the regulations of the Land Department issued under 
the said Act. 

Edward T. Noland. 
Verify according to form on page 313. 

The above application to be filed in the local Land Office and 
to be forwarded to the General Land Office under the first Rule 
6 of the above regulations. No advertisement or public notice is 
required. The proceeding is ex parte until application for lease 
is made. 



CHAPTER 69. 

SUB-HEADS OF THE ACT AND RULES COVERING THE 
MINERALS, THE PARTIES AND THE LEASABLE DO- 
MAIN. 

Gas. 

There are no sections confined specifically to gas. It is neces- 
sarily involved with mention of oil and the prescribed form of 
lease demands the same percentage on the gas as on the oil and 
contains no reference to the mode of delivery but doubtless the 
royalty would be paid on the valuation in almost every case. 

Helium. 

This mineral mentioned in section 1 of the Act is a very rare 
element, discovered in the sun by spectroscope in 1868 and on 
earth in 1895. It is not quite as light as hydrogen gas but 
avoids the danger of combustion when used in aerostatics. It 
is found in the gas of a few wells and the government right to 
it is reserved for use in army balloons. 

Phosphates and Sodium. Mill Sites. 

There is a special provision not applicable to any other form 
of mineral allowing a 40. acre mill site to a phosphate claim in 
section 12, and to a sodium claim in section 25. 

Parties. 

The parties entitled to the benefits of the Act are ; 

1. Citizens of the United States. 

2. Any association of such citizens. 

3. Any corporation organized under the laws of the United 

States or of any State or Territory. 

4. In the case of coal, oil, oil shale and gas to municipali- 

ties. 

M. O. R.— 27. 417 



i 18 MOIililSON'S HJL RIGHTS 

Proof of Citizenship. Aliens. Reciprocity. 

Proof of citizenship at the proper time is required in all pro- 
ceedings seeking for permit, lease or patent from the Land Office, 
but the ownership of stock in corporations by declarants or aliens 
is not prohibited except by the last clause of section 1, by which 
citizens of other countries; which deny like rights and privileges 
to American citizens, are denied the rights to own or control 
stock. 

Although an alien may not patent mining property he has a 
standing to protect his title or beneficial interest either before 
the Land Department or in the Courts. Ginaca v. Peterson, 265 
Fed. 904. 

When the United States parts with its title, by patent to 
mineral land it has no further control of ownership, working or 
production, but under the 1920 Act the government becoming 
a lessor instead of a grantor, it retains an interest in the land 
which would protect its constitutional jurisdiction to enforce 
this proviso. 

Where such aliens, in defiance of the proviso, obtain control 
of the company it might become a material fact in proceedings 
to set aside the lease, but such ownership by a single stockholder 
would hardly invalidate the entire document. 

This proviso applies to citizens of nonreeiprocating countries, 
not to aliens generally. 

Citizens of other countries deirying like privileges to citizens 
of the United States are precluded and may not become owners 
of interests through stock or any corporate agency. 

Declarants. 

It will be noted that persons who have declared their inten- 
tions to become citizens who were allowed to locate under the 
old law are precluded by this Act. 

Citizenship of Corporation. 

The regulations require allegations of the residence and citi- 
zenship of the stockholders, on applications by corporations, and 
if alien ownership appeared on such showing it would be on the 



MINERALS, PARTIES AND DOMAIN 419 

department to raise the point that the citizenship shown brought 
the ease within the terms of the reciprocity proviso. 

Alaska. 

Sec. 22 is confined to this country and covers only oil and gas 
lands. Details of applications under this section are found in 
regulations 22 and 23. 

Special limitations on oil and gas are found also in the two 
provisos of section 13. 

Alaska is entirely excepted from the provisions of the coal 
sections 2-6, so that coal land in that country is governed by 
previous Statutes special to that Territory. 

Except as to oil, gas, and coal as above noted, no other specif- 
ic clauses refer to Alaska so that oil shale, phosphates and 
sodium claims in that country are governed by the general 
clauses of the Act. 

The general tenor of the Act where Alaska is specially men- 
tioned is to give more liberal terms to that country. 

Five oil and gas permits or leases may be issued for Alaska 
Sec. 22. 

Exclusions. 

The exclusions are: 

1. National Parks. 

2. Military Reservations. 

3. The Naval Petroleum Reserves. 

4. Lands granted under the Appalachian Forest Act. These 
exclusions are all referred to in the first Section of the Act. 

5. Indian lands and reservations altho not specially men- 
tioned are impliedly excluded and Rule 2 of the Regulations, 
notes this point. 

Land reserved as a national park would of course be well 
known in the district. Military reservations are few in number 
and well known, but the lands covered by the naval reserves 
cover an immense amount of acreage and are especially referred 
to on pages 514-516. 

The lands covered by the Appalachian Forest Act is a very 
limited area. See page 510. 



420 MORRISON'S OIL RIGHTS 

Local Exceptions. 

Barring special provisions as to Alaska which are elsewhere 
mentioned, the only local exemptions from the Act are sodium 
claims in San Bernardino County, California, and a few coal 
entries in Wyoming mentioned in footnote at page 293. 

Saving Clause. 

Section 37 saves the rights of all valid claims on any of the 
minerals mentioned in the Act which would include oil placers 
and oil shale placers and the like locations on phosphate and 
sodium deposits and all rights to coal land which had become 
vested under the old law. 

It saves all such claims which, valid in every other respect, 
were short on discovery and allows such claims to become valid 
in all respects when they make a discovery. 

The words "thereafter maintained" used in the section mean 
that the annual labor must be kept up. 

There is also a saving clause in Section 27 referring to certain 
forfeited claims which protects interests in such claims "ac- 
quired by descent, will, judgment or decree" that is by innocent 
parties, for the period of two years. 

The department places its construction of sec. 37 in its regula- 
tions, rule 32 printed on page 364. 



CHAPTER 70. 

SUB-HEADS OF THE ACT AND RULES COVERING 
PREFERENCE, PERMITS AND LEASES. 

Limitations of Acreage. 

Limitations of acreage to claims of any sort are scattered 
through the Act without any apparent theory upon which the 
distinctions are based and are tabulated as follows : 

Coal. 40 acre tracts or multiples of 40 acres, limit 2560 acres. 
Sees. 2-6. 

Phosphates. Limit 2560 acres. Sees. 6 and 10. 

Coal to municipal corporations. Limit 320 to 2560 acres ac- 
cording to the population of the city. Sec. 8. 

Free coal, not for sale, no express limitation. Sec. 8. 

Oil and gas permits on undeveloped territory. Limit 2560 
acres. Sec. 13. 

Oil and gas leases; one-fourth of the amount of the permit 
which would be 640 acres, but not less than 160 acres on un- 
developed territory. Sec. 14. 

Oil and gas lease on known geological structure, 640 acres. No 
permits are granted on this structure. Sec. 17. 

On Proclamation claims deeded back to the United States, if 
on known geological oil and gas structure, limit 3200 acres. 
^ec. 18. 

On Proclamation suits compromised by the President, there 
seems to be no limitation. Sec. 18A. 

Mineral on severed land limit 2560 acres. Must be within an 
area not greater than a township. Sec. 20. 

Sodium limit 2560 acres, with mill site of 40 acres. Sees. 23, 
25. 

On Shale Lease, 5120 acres. Sec. 21. 

421 



4 -^ MORRISON'S OIL RIGHTS 

Alaska. 

The limit of an oil and gas lease or permit is 1280 acres. Sec. 
22. 

Limitations on the Number of Leases. 

Sec. 19. This Section is confined to oil placer locations prior 
to October 1, 1919, validly located except as to discovery. 

By implication, the limitation is to the size of each claim, 160 
acres, but there is no limitation on the number of claims. 

Sec. 21. Last Proviso. Only one oil shale lease is allowed to 
any one person. 

Sec. 27. One coal lease, one phosphate lease, one sodium lease, 
in any one State is the limit to applicants. 

Three oil or gas leases in any one State to a single party. 

Not more than one lease on the same geological structure of the 
same field. 

"No corporation shall hold any interest as a stockholder of 
another corporation in more than such number of leases." 

No railroad corporation shall be given a coal permit or lease 
except for its own use for railroad purposes and only one per- 
mit or base for each 200 miles of its line within the State. Sec. 2. 

Five oil and gas permits or leases may issue in Alaska. Sec. 
22. 

Leases and Permits on Unsurveyed Land, Size and Shape. 

There are repeated directions in several sections for the segre- 
gation of land where there are no government subdivisions. 
They should have been covered in one section but are scattered 
promiscuously. They seem to be fairly uniform on the follow- 
ing points : 

1. The survey is to be by the United States but at the expense 
of the applicant covered by a deposit. Any surplus over the 
expense to be returned. 

2. The segregated tract to be in compact form, the length not 
to exceed two and one half times the width. 

These provisions are to be found as to phosphate lands in 
section 10, as to permits on oil and gas lands on nonproven 
ground in section 13. 



PREPBHBNGB, PERMITS AND LEASES 423 

As to the area selected by a successful permittee out of his 
total area, in section 14. 

In less definite terms as to oil shale in section 21. 

In like general terms as to sodium in section 24. These two 
last cited sections leave the shape to be under the regulations 
of the department, which of course, would require them to be in 
compact form. 

The surreys for pipe lines are to be under regulations pre- 
scribed by the Secretary. Sec. 28. 

The provisions of the Act are reinforced by the regulations. 
Reg. 4 d, Reg. 25 c. 

The diagram on application for permit, must show all wells 
and improvements. Reg. 25 g. 

Term of Lease. 

Coal leases are to be indeterminate as to duration of term. 
Sec. 7. Phosphate leases the same, Sec. 11. 

Also oil shale, Sec. 21. The term of oil and gas lease's whether 
on proven or unproven ground is twenty years. Sees. 13, 17 
and 18. 

Sec. 23 provides for two year leases on sodium but Sec. 24 
makes auctioned leases on sodium indeterminate. 

Two years is the limit of an oil and gas permit. Sec. 13. 
Permits may run for four years in Alaska, Sec. 13. 

Waste of Oil and Gas. 

Section 16, reinforced by section 30, requires that both lease 
and permit shall provide for reasonable precautions to prevent 
waste of oil and gas and also to protect the oil sand from injury, 
prescribing suit for judicial forfeiture for breach of such cov- 
enant. 

The regulations require that bond in $1000 shall be furnished 
by the permittee to protect such covenant and prescribe a form 
for the bond. Reg. 4, subsection I. Reg. 6 subsection C. The 
form of the bond is printed on page 336. 

Waste is to be provided against in oil shale leases. Sec. 21. 
And in sodium leases. Sec. 24. 



424 MORRISON'S OIL RIGHTS 

Payment of Wages. Eight Hour Day. Minors and Women. 
Coal Weighing. 

All these enumerated incidents are to be provided for by the 
terms of the lease under the provisions of section 30. 

Strikes. 

Strikes are to be anticipated and allowed for in the coal 
leases. Sec. 7. And in phosphate leases. Sec. 11. 

Severed Lands. 

Where there has been agricultural entry on lands not with- 
drawn or classified at the time of entry as mineral (but not in- 
cluding railroad lands) the holder of the surface title has a pref- 
erence right to a permit and lease. This seems merely to mean 
that the party holding the surface right has the privilege to be- 
come the lessee on the mineral, but it does not seem to cut out 
any other 'applicant for the mineral right on the same ground 
which is allowed to all citizens under the terms of section 34. 

Reservation of Surface. 

In any lease the surface and use of the surface may be re- 
served for further disposition saving the surface use to the 
lessee to the extent necessary for extracting and removing the 
oil, gas or other minerals, but such reservation must be deter- 
mined before the lease is signed. The last proviso of the section 
is an obscure authorization to issue "permits for easements here- 
in provided to be reserved". Sec. 29. 

Advertisements. 

The act and rules require public newspaper notice of auction 
for bids on the geological section tracts. Sec. 17. Reg. 14. 

Advertisements for thirty days in a local newspaper are 
demanded before the issue of coal leases. Sec. 2. 

Advertisements are permissably allowed on phosphate leases. 
Sec. 9. and on the proposal to sell the royalties on an oil and 
gas lease. Sec. 36. 



CHAPTER 71. 

SUB-HEADS OF THE ACT AND RULES AS TO RENTS 
AND ROYALTIES. 

Rents and Royalties. 

Wherever rent is demanded it is payable in advance but is 
to be credited on the subsequent royalties. 

Coal. 

Royalty not less than 5 cents per ton of 2000 lbs. and an acre- 
age rent of not less than 25 cents per acre for the first year, 50 
cents. for the second, third, fourth and fifth years and $1. for 
each succeeding year. The lease may provide for a minimum 
tonnage to be protected by the advance rentals. Sec. 7. 

On leases of coal for private use, and on municipal coal leases 
the product to be sold at cost, no rent or royalty is charged. Sec. 



Phosphates. 

Two per cent on the gross value and the rent not under 25 
cents per acre for the first year, 50 cents on each of the next 
four years and $1 on the later years. Sec. 11. 

Oil. 

On the one-fourth leased to the permittee, 5 per cent to be 
covered by the advance rent of $1 per acre. Sec. 14. 

On the three-fourths reserved by the government not less 
than 12-J- per cent. Sec. 14. 

Between the date of production and date of filing application 
for lease, the permittee pays 20 per cent. See. 15. 

On leases within the known geologic structure not less than 

425 



426 MORRISON'S OIL RIGHTS 

Vl\ per cent protected by advance rent of $1. per acre besides 
the bonus. Sec. 17. 

On Pickett Act claims one-eighth of the oil and gas already 
produced. Future royalties covered by the lease, not less than 
1 2^ per cent to be fixed by the Secretary. Sec. 18. 

On the no-discovery claims covered by section 19 on the known 
geologic structure, not less than 12| per cent. On the severed 
lands, not less than 12^ per cent. Sec. 20. 

Oil Shale. 

The lessee to pay 50 cents per acre each year to protect the 
royalty, which is not fixed by section 21, 

Sodium. 

On leases provided for in the first paragraph of Sec. 24 the 
royalty to be not under one-eighth of the production. 

On leases provided for in the further clauses of the section, 
the royalty is the same, one-eighth to be protected by an advance 
rent of 50 cents per acre on the first year and $1. for each suc- 
cessive year. 

The Distribution of the Royalties 

is provided for in sec. 35. Payment of oil and gas royalties in 
kind may be demanded by the Secretary of the Interior. Sec. 
36. The sale of oil and gas royalties is covered by the same sec- 
tion. 

Reduced Oil or Gas Production. Other Waivers. 

Reduction of oil and gas royalties where production falls off. 
is provided for in section 17. The last sentence of section 17 
doubtless refers to this reduction clause. The sentence speaks 
of the last "paragraph" altho the section as printed contains but 
a single paragraph. It probably was intended to mean the pre- 
ceding clause or sentence which is the reduction clause. 

Rents and royalties on oil shale may be waived for five years. 
Sec. 21. 



RENTS AND ROYALTIES 427 

Royalties in Alaska may be waived for the first five years. 
Sec. 22. 

Six months suspension of work may be allowed on coal leases. 
Last proviso of section 7. 

Phosphate lessees may be allowed to suspend work for twelve, 
months. Sec. 11, last .proviso. 

Distribution of Royalties. 

Sec. 35 enacts that 10 per cent of all proceeds of sale, bonuses, 
rents and royalties "excepting those from Alaska" shall be 
credited to miscellaneous receipts, and all receipts from the 
Naval Petroleum Reserves go to the same account. 

Seventy per cent of past production and 52-J per cent of 
future production go to the reclamation fund of June 17, 1902. 
32 Stat. L. 388. Comp. L. Sec. 4700. 

Twenty per cent of past production and 37tV per cent of future 
production is to go to the proper State for the support of educa- 
tion or roads as its legislature may direct. 

Bonus. 

A bonus is demanded where land on the known geological 
structure is offered at auction. Sec. 17, 



CHAPTER 72. 

SUB-HEADS OF THE ACT AND RULES AS TO RENEWALS, 
EXTENSIONS, SURRENDER, READJUSTMENT, AS- 
SIGNMENTS, SUB-LEASES AND FORFEITURE. 

Renewals. 

Section 17 refers to renewal clauses in oil and gas leases on 
the known geological structure, and section 14 provides for the 
same sort of renewals on leases on non proven territory. 

Extension of Permit. 

The two year limit of the permit may be extended for not 
exceeding two more years by the Secretary of the Interior under 

sec. 13. 

Surrender. 

This right, so material and so common in oil and gas lease 
is recognized in section 30 where the lessee is, if the Secretary 
consents, allowed to surrender and be discharged from further 
obligations under the lease. He may be allowed to surrender 
any legal subdivision of the area as well as the whole leased tract. 

Special provision is made for the surrender of a coal lease upon 
the issue of a new consolidated lease. Sec. 5. 

Readjustment. 

Leases in Alaska are subject to readjustment at the end of 
twenty years. Sec. 22. 

Readjustment of coal leases at the end of twenty years is pro- 
vided for in Sec. 7. Of sodium leases, Sec. 24. Of phosphate 
leases. Sec. 11. Of oil shale, Sec. 21. 

428 



RENEWALS AND EXTENSIONS - 429 

Combined or Modified Coal Leases. 

Under sections 3, 4 and 5 coal leases may be modified with 
the approval of the Secretary of the Interior by adding* addi- 
tional tracts surrendering worked ont ground or consolidating* 
two or more leases. The new lease to be within the specific limit 
of 2560 acres. 

Consolidation of Phosphates Leases. 

Under section 6 there may be a consolidation of phosphates 
leases the same as is provided for coal leases. ' 

Assigns and Sub-leases. 

The rights of assignees of permits and leases are declared in 
the last paragraph of section 19 and section 30 forbids all as- 
signing and subletting except with the consent of the Secretary 
of the Interior. 

Forfeiture 

By judicial action is expressly provided for, for allowing waste 
of mineral or damage to the oil sand under Sec. 16. 

For holding monopolistic or other interest "in violation of this 
Act" by the terms of Sec. 27. 

For failure to comply with the easement and pipe line condi- 
tions. Sec. 28. 

For failure to comply with the Act or violation of the regula- 
tions or breach of the covenants of the lease by Sec. 31. 

Sec. 26 contains the only authorization of forfeiture or can- 
cellation by the department without judicial sanction, and such 
authority is confined solely to permits. 



CHAPTER 73. 

SUB-HEADS OP THE ACTS AND RULES ON EASEMENTS, 
PROTECTION AND TAXES. 

Pipe Lines. 

Pipe lines are granted right of way for the carriage of oil and 
gas through the public lands, including the forest reserves, to 
the- extent of the ground occupied by the pipe line and 25 feet 
on each side. 

The survey, application and other incidents are to be under 
the control of the Secretary of the Interior and upon the express 
condition that the company is to be a common carrier. Sec. 28. 

The next proviso of the same section forbids discrimination 
against the government or any person and requires the terms 
of the proviso to be inserted in every oil lease. Paragraph 0. 
of section 3 of the form of lease printed in the regulations, at- 
tempts to comply with this proviso. 

The last proviso of the section is a useless repetition of the fact 
that rights, of way shall be subject to the terms of the section and 
that failure to comply with such term or with the regulations 
shall be ground for forfeiture. 

Section 29 enacts that the permits, leases and licenses issued 
tinder the Act shall reserve the right to provide for the joint or 
several use of rights of way and other easements. 

See, Right of Way for Pipe Line, chapter 89. 

Railroads. 

Railroads are not allowed to hold coal permits or leases, ex- 
cept for their own use which limitation of use is to be expressed 
in the papers issued to them and they are not allowed to hold 
more than one permit or lease for each two hundred miles of 
track within the State. Sec. 2. 

430 



BASEMENTS AND TAXES 431 



Protection. 



Section 16 provides that a margin of 200 feet shall be protec- 
tion ground. No wells are to be sunk on it unless the adjoining 
land is held by private owners: that is, not held by the United 
States or their lessees or permittees. The theory of and neces 
sity for protection, are stated in chapter 9. 

Such a margin of 200 feet around a square 160 acre tract 
would cover 1,952,000 out of 6,969,600 square feet and would 
amount to more than one-fourth of the leased area. 

No well is to be sunk within 660 feet of a naval reserve well 
without the consent of the lessee unless the protection is re- 
leased by the President, sec. 18, rule 19, subsection b. 

Taxation. 

The right of the States to tax is expressly authorized in sec- 
tion 32 which would include the authority to collect license 
charges. 

It will be noted that the clause refered to, is not a grant of 
power but simply the statement that the Act is not to be con- 
strued to deny such right where it lawfully exists. The power 
of the State to tax possessory rights on the public domain has 
long been recognized. See page 154. 



CHAPTER 74. 

SUB-HEADS OF THE ACTS AND RULES ON THE 
PROCLAMATION AND RELIEF CLAUSES. 

Claims without Discovery. 

Section 19 is confined to a single class of claims, oil placers 
which had a location valid in all respects except discovery. And 
where the owners have expended $250 in work or improvement 
on each claim. 

The section says "upon which discovery had not been made 
prior to the passage of this Act" and it is limited to persons 
who were claimants on October 1, 1919. 

A claimant covered by the terms of this section is allowed a 
permit on nonproven territory or a lease if his claim is on the 
known geological structure. 

But before he is so entitled he must quit claim to the United 
States. Sections 20 and 21 of the regulations go into details of 
the procedure. 

Assuming that a placer claim on which no discovery had been 
made is not a vested right, the Act seems to be valid as -to this 
'class of claims. 

The section says "where any such person has heretofore made 
such discovery" he may get a lease upon quit claiming his pos- 
sessory title. But it seems obvious that when discovery has been 
made at any time before the passage of the Act if the party had 
been in diligent prosecution of work under the Pickett Act such 
party is entitled upon completion of $500. of improvements to 
proceed to patent. 

There is nothing in the section that we can see to deprive him 
of this right and it is strengthened by the saving clause of sec- 
tion 37 of the Act. It would be an extraordinary case where 
such claimant of his own volition would elect to accept a permit 
or lease instead of a patent if entitled to such patent. 

The date of October 1, 1919 mentioned in the section seems to 
have been arbitrarily selected. We know of no Act which would 
affect the status of a claimant going into effect on that date. 

432 



PROCLAMATION AND RELIEF 433 

Class of Beneficiaries under the Proclamation. 

Section 18 is an involved enactment intended for the relief 
of a limited class of claimants on withdrawn lands on the known 
geologic structure under the Proclamation of September 27, 
1909. 

1. The applicant must quit claim to the United States all 
interest claimed before July 3, 1910. Such quit claim miist be 
filed within six months from the date of the approval of the 
Act. 

2. There must have been drilled one or more wells to discovery. 
Naval reserves are of course excepted. 

3. He must pay as royalty one-eighth of the Oil or Gas already 
produced and there must be no adverse claimant. He must be in 
undisputed possession of his claim. He then becomes entitled to 
a lease of 20 years on not more than one half of the area, the 
royalty to be fixed by the department. The suits brought by 
the government shall thereupon be dismissed and any interned 
fund distributed. 

Although the first paragraph of the section speaks of the 
claimant being in undisputed possession, a further paragraph 
allows the Secretary to grant leases to one or more of them where 
there are conflicting claimants. The first paragraph possibly re- 
quires the possession to have been disputed before July 1, 1919. 

Assigns from Claimants 

since September 1, 1919, who hold excess acreage are debarred 
from the benefits of the section, but the proviso to such effect does 
not apply to exchange of land made before January 1, 1920. The 
proviso is complicated and its exact language must be studied in 
every case. See page 278. 

Proclamation Compromises. 

Section 18A is a special clause authorizing the President to 
direct the compromise of government suits on withdrawn land. 
Such authorization seems to be limited to twelve months after 
the approval of the Act and of course any such compromise 
would be res inter alios acta so far as any claimants not parties 
to the litigation are concerned. 
M. 0. R.— 28. 



CHAPTER 75. 

SUBHEADS OF THE ACT AND RULES ON CONTRO- 
VERTED CLAIMS. 

Adverse Claims. 

Under section 18 where there are conflicting claims nnder the 
Pickett Act the Secretary is authorized "to grant leases to one or 
more of them as shall be deemed just." If such claimants under 
the Pickett Act have no standing against the government title 
it would doubtless be considered ministerial action in disposing 
of the public land. But if they have any such equities as would 
give them a standing in court his action would be judicial and 
probably would be enquired into by the Courts upon a proper 
bill. 

Section 2 authorizes the Secretary to consider the equitable 
right of claimants to coal. The remarks above under Sec. 18 
would apply to such coal claims. 



Arbitration. 

Under the last clause of section 31 arbitration may be provided 
for in the lease. There is a widespread prejudice in favor of 
arbitration because it is a catching word seeming to suggest 
fairness, equity and avoidance of litigation. 

In general terms there are three modes of relief in case of dis- 
agreements between lessor and lessee. 

1. The ex parte action of the lessor, declaring forfeiture — 
which is necessarily one sided and apt to be harsh. 

2. Relief by Court action, which is due process of law, the 
usual, and ordinarily the preferable procedure, and : 

3. Arbitration, where everything depends on the individuality 

434 



CONTROVERTED CLAIMS 435 

of the board and the personal domination of one of the arbitra- 
tors, too often determines the decision. 

By the terms of See. 18A, the President is authorized to com- 
promise suits under the withdrawal by the Proclamation of Sep- 
tember 27, 1909. 

Nothing is said about the instance where there might be two 
or more claimants to lands so compromised, but no party could 
complain of such action unless he had a proteetible equity in 
which ease doubtless his action might still lie against the favored 
party holding evidence of title issued by the department. 



CHAPTER 76. 

SUB-HEADS OF THE ACT AND RULES ON THE DE- 
PRECATORY CLAUSES. 

Corporations 

are limited the same as individuals as to the number of leases 
that can be held. But the next clause of section 27 and evidently 
intended to limit corporate control of oil territory, is confused 
perhaps beyond intelligible construction. 1 

Possibly the association holdings and the corporate holdings 
are to be classed separately as to each kind of mineral. That 
is to say : they may hold to the limit in oil and gas leases, to the 
limit in coal leases and to the limit in any other kind of lease. 

As to the limit of a member of an association the following 
instance may be based on a correct construction : 

Supposing that a member of such an association holds a 160 
acre oil lease individually, he may as a member of such associa- 
tion holding other oil leases to the aggregate of 2,560 acres, hold 
2,400 shares out of 2,560 shares representing as many acres which 
2,400 acres added to his individual 160 acres, would reach the 
limit of 2,560 acres. 

When it is attempted to construe the language of the section 
with reference to corporations, it can hardly be said that a hold- 

1 Sec. 27. And no person or corporation shall take or hold any inter- 
est or interests as a member of an association or associations or as a 
stockholder of a corporation or corporations holding a lease under the 
provisions hereof, which, together with the area embraced in any direct 
holding of a lease under this Act, or which, together with any other inter- 
est or interests as a member of an association or associations or as a 
stockholder of a corporation or corporations holding a lease under the 
provisions hereof, for any kind of mineral leased hereunder, exceeds in 
the aggregate an amount equivalent to the maximum number of acres of 
the respective kinds of minerals allowed to any one lessee under this Act. 

436 



DEPRECATORY CLAUSES 487 

er of so many shares of stock out of a total capital stock of so 
many shares, is interested in that proportion in the acreage, be- 
cause the value of the stock has no specific relation to the acreage, 
or to the value of the acreage. 

All that further can be said when the question of corporate 
holdings is reached, is that the possible complications which can 
arise are innumerable and the ultimate construction, if any 
meaning can be forced into this part of the section, must be left 
to the Courts on the particular array of facts which the case may 
present. 



Fraud. 

Section 18 contains the following clause: 

"No claimant for a lease who has been guilty of any fraud 
or who had knowledge or reasonable grounds to know of any 
fraud, or who has not acted honestly and in good faith, shall be 
entitled to any of the benefits of this section. " 

The same paragraph is repeated in sections 19, 21 and 22. 

Under the rule of statutory construction, expressio unius ex- 
clusio alterius, it would be implied that fraud would not be an 
objection to the issuing of leases and permits under other sec- 
tions. For the repetition of the clause in the later sections, there 
is absolutely no excuse and for its use at all very little, because 
it is doubtless true that proof of fraud would defeat any applica- 
tion to the department as it would defeat a suit at law on the 
maxim that fraud vitiates all things which it touches. 

Trusts. 

Trusts are anticipated by the last proviso of section 27 and 
proof of such combination is made ground for forfeiture by de- 
cree of Court. The phrase "prevention of monopoly" is used in 
section 30. 

Combinations. 

The combination of several interests for constructing a refinery 
or carrying on the business of a refinery, or of establishing or 



488 MORRISON'S OIL RIGHTS 

constructing a common carrier pipe line, or an oil or coal rail- 
road are not forbidden under any of the provisos of the Act, but 
such combination is subject to the approval of the Secretary of 
the Interior. Sec. 27. 

But if such combination threatens to become a conspiracy or 
a monopoly, or an unlawful trust, it is forbidden and forfeiture 
may be decreed by appropriate Court proceedings as declared 
in the last proviso of the same section. 



CHAPTER 77. 

SUB-HEADS OF THE ACT AND RULES ON PRACTICE. 

MISCELLANEOUS. 
Bids. 

On the rejection of bids for purchase of royalty the Secretary 
may readvertise. Sec. 36. And the Secretary is allowed the 
right to reject all bids for leases on the three-fourths oil rights 
reserved by the government. Sec. 14. Bids on phosphate de- 
posits are authorized by section 9. Coal leases may be disposed 
of by competitive bidding. Sec. 2. 

Quit Claim to the United States. 

A relinquishment in the form of a quit claim deed to the 
United States is required from applicants under sections 18 and 
19 of the Act and from Alaska claimants under section 22. 

This relinquishment is referred to in sections 18 and 21 of 
the Act and is demanded under rule of the department. The 
ordinary forms of quitclaim deed in common use would comply 
with the requirements set out in rules 18h and 20g. 

Verification. 

All statements, recommendations or reports required by the 
Secretary of the Interior must be under oath unless otherwise 
specified by him. Sec. 33 of the Act and Reg. 25. 

This verification may be taken before the judge or Clerk of a 
Court of Kecoi d having a seal, or a notary public, or the register 
or receiver or any other officer authorized by the laws of the State 
or of the United States and does not seem to be required to be 
made within the land district. 

Fees and Commissions. 

The charges of the register and receiver are fixed by section 31 
of the regulations under authority of section 38 of the Act and 
are printed on page 364. 

439 



CHAPTER 78. 

THE OIL SHALE REGULATIONS. 

Section 21 of the Leasing Act is the only section confined spe- 
cifically to oil shale. 

The applicant petitions for a lease for an "indeterminate peri- 
od" which undoubtedly means until the pay shale is exhausted. 

No preliminary permit is provided for, nor any bonus, nor any 
bidding, only a specific lease for the selected tract. 

The royalty is to be fixed by the department protected by rent 
payable in advance that is to say : the specific rent of fifty cents 
per acre is to be credited to the royalty as it becomes due. 

On one of the provisos of the Act, that any person having a 
valid claim on January 1, 1919 shall upon relinquishment of such 
claim be entitled to a lease, the department in rule 7 puts its 
own construction. This proviso is peculiar: it allows the lease 
to reach 5120 acres, which is eight full sections being the largest 
acreage found in the Act. This is its only enlargement for the 
benefit of the claimant. Its other provisions require a surrender 
of his title, which means a disclaimer of his right to a patent. It 
would be purely a business question whether the claimant should 
surrender, or assert his vested rights to go to patent. 

If the applicant believes that the royalty under a lease would 
be less than the cost of his patent he might apply under that 
proviso, otherwise the proviso is not to his advantage. 

This Rule 7 uses the words "prior to January 1, 1919" refer- 
ring to the date beyond which shale claims are not recognized. 
Section 21 which it quotes says "on January 1 ,1919." The rule 
would cut out locations made on that date of January 1, the 
first day of the year, being a date on which every year many 
relocations are made, and the Act, not the rule, would control 
on this point. 

The rule quoted implies that the claimant should clear himself 

440 



OIL SHALE REGULATIONS 441 

of the insinuation of fraud, which is contrary to the rule of prac- 
tice in any Court or department that we know of. 

The same rule, 7, says that claimants of such preferred rights 
to leases should present same promptly otherwise the land may 
be leased to others, in which case any preference rights under 
this proviso will be deemed to have lapsed. 

If the department were to grant a lease covering lands already 
protected by a valid location it would bring up a contest at once 
between the claimant and such lessee and if the claimant proves 
his vested rights, such unauthorized lease by the department 
would be void. Such issue would arise by suit in Court brought 
by either party outside of the department's jurisdiction. 

Petition and Notice. 

As no permit is granted for the prospecting or developing of 
an Oil Shale claim, the" first step to secure the right to work 
such a claim is by an application for a lease of which we give 
the following form, which should be accompanied with a form 
of notice for publication, and by the affidavit of citizenship of 
the applicant. (For form of this notice see page 446.) 

Form of Petition for Oil Shale Lease. 

To the Hon. Commissioner of the General Land Office: 
Your petitioner C. \V. Thompson respectfully represents: 

1. That his address is 1812 Lawrence Street, City and County 
of Denver, State of Colorado. 

2. That he is a native born citizen of the United States, as 
shown by his affidavit herewith filed. 

3. That your petitioner has no lease under the provisions of 
any section of the Oil Leasing Act approved February 25, 1920, 
nor any application for lease thereunder pending, and that he 
does not hold interests in such lease or any application for lease 
which with the land applied for will exceed 5,120 acres. 

4. That the land upon which the Oil Shale Lease is now ap- 
plied for is not officially surveyed but that it covers 160 acres in 
square form which has been marked and staked by your peti- 
tioner by lines running due north, south, east and west. 



442 AIOKRTSOX'^ OIL KFGI1TS 

5. To- wit : Beginning at a point marked by a substantial stake 
as corner No. 1 the North West corner and c. w. t. the initials 
of the petitioner, and the name of the claim, to- wit : The Rattle- 
snake claim, from which corner a United States locating monu- 
ment bears North, 10° East, at the distance of 3100 feet, and 
running thence east 2660 feet to corner No. 2 ; thence South 2660 
feet to Corner No. 3 ; thence West 2660 feet to corner No. 4 and 
thence North 2660 feet to the place of beginning. At each corner 
is a substantial stake marked with its number and the initials of 
your petitioner. Situate in unorganized Mining District, Coun- 
ty of Rio Blanco, State of Colorado. 

6. That your petitioner is ready to deposit with the United 
States Surveyor General of the State of Colorado the estimated 
cost of making a survey of the land as required by rule 3. d. of 
the Oil Shale Regulations, Circular No. 671, issued by the De- 
partment of the Interior on March 11, 1920. 

7. That the land applied for is valuable for its oil shale con- 
tents and shows an outcrop for at least 500 feet in length of an 
oil shale bed between strata of sandstone, which oil-shale bed is 
at least 20 feet in thickness vrith a dip of about 5° from the 
horizontal, assays from the shale showing an average value of 
about 30 gallons of crude oil to the ton of rock. 

8. The proposed method of mining so far as determined is to 
be by an incline from which levels or laterals will be run from 
each side of the incline, the stopping to be overhead from the 
levels, leaving pillars or arches for support to prevent caves. 
The proposed method for working the shale and extracting its 
values is under the patented process of C. W. Thompson, which 
has been successfully tested at several places in the State of 
Colorado. 

9. To work said shale will require an investment in the build- 
ing of reduction works on or near the premises of at least $10,- 
000, and your petitioner has in the bank of Meeker, Colorado, 
$2,000 of that sum and substantial guaranties for the advance of 
the remainder as soon as this lease prayed for is secured. 

10. A notice of application as required by Rule of the De- 
partment 3 g, in duplicate, is herewith enclosed. (Form of this 
notice on page 446.) 

Respectfully submitted, 

C. W. Thompson. 



oil shale regulations 44o 

Sta/ee of Colorado, ) - 

ss. 
County of Rio Blanco. \ 

Before me, the subscriber a Notary Public, in and for said 
county, personally appeared C. W. Thompson who being first 
duly sworn, saith: that he is the petitioner named in the fore- 
going application for lease, that he has read the same and knows 
the contents thereof and that the same and the matters and 
things therein stated are true of his own knowledge. 

C. W, Thompson. 
Sworn and Subscribed to before me this 1st day of November, 
A. D. 1920. 

My Commission expires January 30, 1923. 

D. A. Burgess, 
Notary Public. 

Subdivision e. of rule 3 seems to imply that the surface neces- 
sary for the extraction plant is nonmineral but it can be com 
plied with, as it must be assumed that the department knows 
that not every acre of any sort of mining claim is mineral bear- 
ing, and the plant could as well be placed over the mineral bear- 
ing bed as anywhere else. 

Rule 4. (b) requires a notice to be posted on the bulletin and 
published, in the nature of the notice required on application 
for patent to a lode but inviting a controversy in the Land Office, 
which would be wholly different from the adverse claim antici- 
pated in the published notice on application for patent and would 
be simply a Land Office contest similar to like disputes between 
agricultural claimants. 

OIL SHALE REGULATIONS. 

(Circular No. 671.) 

Department of the Interior, 
General Land Office, 
Washington, I). C, March 11, 1920. 
Registers and Receivers, 

United States Land Offices. 
Sirs: Section 21 of the Act of Congress approved February 



444 MORRISON'S OIL RIGHTS 

25, 1920, entitled "An Act to promote the mining of coal, phos- 
phate, oil, oil shale, gas, and sodium on the public domain," au- 
thorizes the Secretary of the Interior to lease any deposits of oil 
shale belonging to the United States, and the surface of such 
lands as may be necessary for the extraction and reduction of 
the minerals leased. The following rules and regulations will 
govern the issuance of such leases : 

1. Qualifications of applicants. — Pursuant to section 1 of said 
Act, leases may be made to (a) a citizen of the United States; 

(b) an association of such citizens; (c) a corporation organized 
under the laws of the United States, or of any State or Territory 
thereof, provided that no stockholders are citizens of nonrecipro- 
cating countries, as provided in section one of the Act; or (d) 
a municipality. 

2. Lands and deposits to which applicable. — The lease may in- 
clude such deposits and the surface of so much of the land con- 
taining same, or of land adjacent thereto, as may be required for 
the extraction and reduction of the leased minerals, the aggre- 
gate area not to exceed 5,120 acres. 

Such leases may not include lands or deposits in (a) national 
parks, (6) forest reserves created under the Act of March 1, 1911 
(36 Stat., 961), known as the Appalachian Forest Reserve Act, 

(c) lands in military or naval reservations, (d) Indian reserva- 
tions, or (e) ceded or restored Indian lands, the proceeds from 
the disposition of which are credited to the Indians. 

All permits or leases for the exploration for or development of 
oil or gas deposits under this Act within the limits of national 
forests or other reservations, or withdrawals to which this Act 
is applicable, shall be subject to and contain such conditions, 
stipulations and reservations as the Secretary of the Interior 
shall deem necessary for the protection of such forests, reserva- 
tions, or withdrawals, and the uses and purposes for which 
created. 

3. Form and contents of application. — Applications for leases 
must be under oath, and should be filed in the proper district 
land office, addressed to the Commissioner of the General Land 
Office. No specific form of application is required, and no blanks 



OIL SHALE REGULATIONS 445 

will be furnished, but it should cover iu substance the following 
points : 

(a) Applicant's name and address. 

(b) Proof of citizenship of Applicant, by affidavit of such fact 
if uativc born; if naturalized, by a certified copy of a certificate 
thereof in the form provided for use in public land matters, un- 
less such copy is on file. If the applicant is an association, each 
member thereof must show his qualifications as above stated ; 
if a corporation, a certified copy of the articles of incorporation 
must be filed, together with evidence that none of its stockhold- 
ers are citizens of another country the laws, customs, or regula- 
tions of which deny similar or like privileges to citizens or corpo- 
rations of this country; if a municipality a showing of (1) the 
law or charter and procedure taken by which it has become a 
legal body corporate; (2) that the taking of a permit or lease is 
authorized under such law or charter; and (3) that the action 
proposed has been duly authorized by the governing body of such 
municipality. 

(c) A statement that the applicant has no lease under the 
provisions of this section, nor any other application for lease 
thereunder pending, and that he does not hold interests in such 
leases or applications which, with the land applied for, will ex- 
ceed 5,120 acres. 

(d) Description of land for which the lease is desired, by le- 
gal subdivisions if surveyed, and by metes and bounds if unsur- 
veyed, in which latter case the description should be connected 
to some corner of the public land surveys where practicable, or 
to some permanent landmark. If the land is unsurveyed, the 
applicant, after he has been awarded the right to a lease, but 
before the issuance thereof, will be required to deposit with the 
United States surveyor general of the State where the land is 
located the estimated cost of making a survey of the lands, any 
balance remaining after the work is completed to be returned. 
This survey will be an extension of the public land surveys over 
the tract applied for, the leased land to be conformed to legal 
subdivisions of such survey when made. 

(e) Evidence that the land is valuable for its oil shale content, 
except so much thereof as is necessary for the extraction and re- 



446 MORRISON'S OIL RIGHTS 

duction of the leased minerals, with a statement as accurate as 
may be of the character and extent and mode of occurrence of 
the oil-shale deposits in the lands applied for. 

(/) Proposed method, so far as determined, as to the process 
of mining and reduction to be adopted, the diligence with which 
such operations will be carried on, and the contemplated invest- 
ment in reduction works and development, and the capital avail- 
able therefor. 

(g) The application shall be accompanied by a notice for pub 
lication, in duplicate, prepared for the signature of the register. 
in substantially the following form : 

Serial No Department of the Interior, 

U. S. Land Office at ...... 

19.., 

Notice of Application for Oil Shale Lease. 

Notice is hereby given that in pursuance of the Act of Con- 
gress, approved February 25, 1920, whose post- 
office address is has made application for oil shale lease 

covering the following described lands : 

Any and all persons claiming adversely any of the above de- 
scribed lands are required to file their claims in this office on or 

before , otherwise their claims will be disregarded in the 

granting of such lease. 

; , Register. 

The register will fix the time within which adverse or conflict- 
ing claims may be filed at not less than thirty, nor more than 
forty days from first publication. 

4. Disposition of application. — (a) The application will be 
given the current serial number by the register and receiver, 
noted on their records, and the notice for publication will be 
signed by the register. 

(b). One copy of the signed notice will be delivered to the ap- 
plicant, who will cause the same to be published in a newspaper 
to be designated by the register, of general circulation, and best 
adapted to give the widest publicity, in the county where the 
land is situated. If the land is in two or more counties, notice 



Oil. SHALE REGULATIONS 447 

must be published in each. Notice must also be posted in th^ 
Local Land Office during the period of publication. 

(c) At the expiration of the period of publication the appli- 
cation, together with evidence of publication and posting- in 
said office, should be promptly transmitted by the register and 
receiver to the Commissioner of the General Land Office with a 
statement of the status of the land involved as to conflicts, with- 
drawals, protests, and any other matters that may be necessary 
to determine the availability of the land or deposits therein for 
lease. 

5. Action on application. — As the area and form of lands 
leased hereunder is entirely discretionary with the Secretary of 
the Interior, if the area applied for is considered too large, or the 
form unsatisfactory, or in case of conflicting applications, the ap- 
plication may be held for rejection, but the applicant given an 
opportunity to amend his application in conformity with require- 
ments. Should the application be found satisfactory by the 
Commissioner of the General Land Office, he will submit it to the 
Secretary of the Interior with a recommendation that a lease 
for the described lands be awarded the applicant. If the right to 
a lease be granted, the applicant will be required, within thirty 
days from notice, to pay the rental of 50 cents per acre for the 
first year, which the receiver will carry in his unearned account, 
until the lease is acted upon, and to furnish a lease duly executed 
on his part, which lease will be substantially in the following 
form : 

6. Form of lease,. 

Department of the Interior, 
Serial No U. S. Land Office at .... 

Oil Shale Lease. 

Date — Parties. — This indenture of lease entered into in tripli- 
cate this .... day of , 192 .. , by and between the United 

States of America, acting in this behalf by the Secretary of the 
Interior, party of the first part, hereinafter called the lessor, and 

, party of the second part, hereinafter called the 

lessee, under and pursuant to the act of Congress approved Feb- 



448 MORRISON'S OIL RIGHTS 

ruary 25, 1920, entitled "An Act to promote the mining of coal, 
phosphate, oil, oil shale, gas, and sodium on the public domain,' 
witnesseth : 

1. Purposes. — That the lessor in consideration of the rents and 
royalties to be paid, and the covenants to be observed as herein- 
after set forth, does hereby grant and lease to the lessee the right 
and privilege to mine and dispose of all the oil shale or the prod- 
ucts thereof that may be mined under the terms of this lease 

from the following described lands , containing 

acres, together with the right to construct thereon all such works 
as may be necessary or convenient for the reduction of such shale 
and the preparation of its oil or other contents for market. 

2. Subject to limitations of Act. — It is expressly understood 
that this lease is granted subject in all respects to the conditions, 
limitations, and provisions of the Act under which this lease is 
made, which Act, so far as it relates to oil shale, is hereby made 
a part hereof to the same extent as if incorporated herein. 

3. Rights reserved. — The lessor expressly reserves the right to 
grant, upon such terms as the Secretary may determine to be 
just, such easements or rights of way, including easements in 
tunnels, upon, through, or in the lands leased, as may be neces- 
sary to the working thereof, or of other lands containing coal, 
oil, oil shale, phosphate, gas, or sodium, and the treatment or 
shipment of any of the products of such lands by, or under au- 
thority of the United States, its lessee or permittee, and for other 
public purposes. 

4. The lessee, in consideration of the lease of the rights and 
privileges aforesaid, hereby covenants and agrees as follows: 

(a) Investment. — To invest in mining operations, reduction 
plants, or other equipment for the mining and reduction of the 
minerals leased, as follows : That is to say [Here give detailed 
description of proposed reduction plant and other equipment or 
ivories] , upon the lands included herein the sum of dol- 
lars, of which sum not less than one-fifth be expended during 
the year succeeding the execution of this instrument, and a like- 
sum each year for the succeeding four years, unless such amount 
may be sooner invested. 

(b) Bond. — To furnish within thirty days' after signature of 



OIL SHALE REGULATIONS 449 

the lease, a bond in the sum of one-half the amount to be ex- 
pended each year, conditioned upon the expenditure of such 
sum within said period, and submit annually at the expiration of 
each year for the said period an itemized statement as to the 
amount and character of the expenditure during said year. 

(c) Annual rentals. — To pay as an annual rental, for each 
acre or part thereof covered by this lease, the sum of fifty cents 
per acre each year during the life of this lease, all such annual 
payments of rental to be paid in advance to the receiver of the 
proper local Land Office on the anniversary of the date hereof, 
and to be credited to the first royalties becoming due hereunder 
during the year for which rental was paid, unless during any of 
the first five years of the existence of the lease the lessor waives 
the payment of royalty or rental. 

(d) Royalty. — To pay to such receiver a royalty of per 

centum of the market value of the commercially extractable crude 
oil content, and other primary products of all shale mined and 
sold or reduced, unless the Secretary of the Interior waives the 
payment of such royalty during any or all of the first five years 
of the lease. The lessee agrees to make and keep a record of, by 
methods and practices satisfactory to the lessor, all necessary 
gagings, measurements, or analyses of all shale mined and sold 
or reduced, and all products manufactured therefrom by the 
lessee, to afford an adequate basis for computing and ascertain- 
ing the amount and grade of the crude and other primary prod- 
ucts on the basis of which such royalty is to be paid ; the decision 
of the Secretary of the Interior as to the market value of such 
products on which the royalty is computed shall be conclusive. 
The royalty must be paid on the last day of March, June, Sep- 
tember, and December, each payment to cover the royalty on all 
production during the preceding three months. 

(e) Reports. — To keep accurate account of the amount and 
value of the production under the lease, and to make a report 
on the last clay of March, June, September, and December of the 
amount and value of the production during the preceding three 
months; also the amount invested in the property, the cost of 
operation, contracts in force as to disposal of proceeds, and de- 
preciation of the property used in working the leased land ; the 

M. O. R.— 29. 



450 MORRISON'S OIL RIGHTS 

books, records, property leased, and reduction works to be sub- 
ject to inspection at any time by an accredited agent of the 
lessor. 

(/) Sublease. — Not to assign this lease or any interest therein, 
nor sublet any portion of the leased premises, or any of the 
rights and privileges herein granted without the written consent 
of the lessor being first had and obtained. 

(g) Diligence. — To proceed diligently to develop and mine 
the oil shale upon the leased lands, and extract therefrom the oil 
and other valuable contents by the most approved methods, and 
in such a manner as to utilize all of the shale that can be suc- 
cessfully mined, leaving no available mineral abandoned where 
the mining is being conducted. 

-(h) Regulations. — To comply with such regulations as have 
been adopted by the Secretary of the Interior and were in force 
at date of this lease relative to (1) the safety and welfare of the 
workmen; (2) the prevention of undue waste; and (3) the ex- 
ercise of reasonable diligence, skill, and care in the conduct of 
mining operations, which are made a part hereof as fully as if 
incorporated in this lease; it is also agreed that the workday 
shall not exceed eight hours for underground workers, except 
in cases of emergency, prompt report of which must be made to 
the lessor; that no boy under sixteen years of age, nor any girl 
or woman shall be employed in any mine below the surface ; tha. 
the workmen shall have absolute freedom to purchase their sup- 
plies wherever thej^ may desire; that wages shall be paid twice 
each month in lawful money of the United States. 

(i) Interest in leases. — To observe faithfully the provisions of 
section twenty-seven of the Act, defining the interest or interests 
that may be taken, held, or exercised under leases authorized 
by the Act. 

5. Prevention of monopoly. — The lessor reserves full power 
and authority to carry out by order, and to enforce all the pro- 
visions of section thirty of the Act, to insure the sale of the pro- 
duction of such lands to the United States and to the public at 
reasonable prices, and for the prevention of monopoly, and the 
lessee hereby covenants and agrees to comply with any such 
reasonable order issued in pursuance hereof. 



OIL 811 ALE REGULATIONS 451 

6. Relinquishment. — The lessee, upon consent in writing of 
the lessor, may make a written relinquishment of all rights under 
the lease, and thereupon be relieved of all future obligations 
hereunder, or he may with like consent surrender any legal sub 
divisions of the area included herein, upon payment of all rents, 
royalties, and other debts due and payable to the lessor, and upon 
payment of all wages or moneys due and payable to the work- 
men employed by the lessee, and upon a satisfactory showing to 
the Secretary of the Interior that the public interest will not be 
impaired ; but in no case shall such termination be effective un- 
til the lessee shall have made provision for the .preservation of 
any mines or productive works, or permanent improvements on 
the lands covered by such relinquishment. 

7. Purchase of improvements. — On the termination of this 
lease pursuant to the last preceding section, the lessor, his agent, 
licensee, or lessee, shall have the exclusive right, at the lessor's 
election, to purchase at any time within six months, at the ap- 
praised value thereof, all buildings, machinery, equipment and 
tools, or other personalty placed by the lessee in or on the land 
leased hereunder, save and except underground improvements, 
machinery, equipment, or structures, which shall be and remain 
a part of the realty without further consideration or compensa- 
tion; that the purchase price to be paid for said buildings, ma- 
ehinery, equipment, and tools to be purchased as aforesaid, shall 
be fixed by appraisal of three disinterested and competent per- 
sons (one to be designated by each party hereto, and the third 
by the two so designated), the valuation of the three or a majori- 
ty of them to be conclusive ; that pending such election to pur- 
chase within said period of six months, none of said buildings 
or other property shall be removed from their normal position; 
that if such valuation be not requested, or the lessor shall affir- 
matively elect not to purchase within said period of six months, 
the lessee shall have the privilege of removing said buildings and 
other property, except said underground equipment and struc- 
tures as aforesaid. 

8. Forfeiture. — If the lessee shall make default in the per- 
formance of any of the terms, covenants, and stipulations of this 
lease, and such default shall continue after written notice thereof 
by the Secretary of the Interior or his authorized representative, 



452 MORRISON'S OIL RIGHTS 

the lessor may, by appropriate proceedings, have this lease for- 
feited and canceled in a Court of competent jurisdiction, but this 
provision shall not be construed as depriving the lessor of any 
legal or equitable remedy which the lessor would otherwise have. 
A waiver of any particular cause for forfeiture shall not affect 
the right to proceed against the lessee for any other cause of 
forfeiture, or for the same cause occurring at any other time. 

9. Heirs and successors. — It is further agreed that each obliga- 
tion hereunder shall extend to and be binding upon, and every 
benefit hereof shall inure to, the heirs, executors, administrators, 
successors, or assigns of the respective parties hereto. 

10. Readjustment of royalties. — The lessor shall have the 
right to readjust and fix the royalties payable hereunder at the 
end of twenty years from the date of this lease, and to so read- 
just at the end of such succeeding period of twenty years, but 
the lessee may, if dissatisfied With the royalties imposed, relin- 
quish and surrender this lease in the manner provided in sections 
6 and 7 hereof. 

11. Unlawful interest. — It is also further agreed that no mem- 
ber of or delegate to Congress, or resident commissioner, after 
his election or appointment, or either before or after he has quali- 
fied, and during his continuance in office, and that no officer, 
agent, or employee of the Department of the Interior shall be 
admitted to any share or part of this lease, or derive any benefit 
that may arise therefrom, and the provisions of section 3741 of 
the Revised Statutes of the United States, and sections 114, 115, 
and 116 of the Codification of the Penal Laws of the United 
States approved March 4, 1909 (35 Stat., 1109), relating to con- 
tracts, enter into and form a part of this lease, so far as the 
same may be applicable. 

In witness whereof— 

The United States of America. 

By [l. s.] 

Secretary of Interior. 
Witnesses: 

[t. s.] 



OIL SHALE REGULATIONS 453 

7. Preferred right to a lease. — Under a proviso of section 21 
of the Act, a person having a valid claim to oil shale deposits 
under existing- law, prior to January 1, 1919, shall, upon the re- 
linquishment of such claim or claims, be entitled to a lease for 
not exceeding 5,120 acres, provided "that no claimant for a lease, 
who has been guilty of any fraud or who had knowledge or rea~ 
sonable ground to know of any fraud, or who has not acted 
honestly and in good faith, shall be entitled" to such lease. 

The beneficiaries of this proviso are those persons or their 
grantors, who, in the honest belief that the mining laws were ap- 
plicable to oil shale deposits, have proceeded in absolute good 
faith to make mineral locations, lode or placer, of shale deposits, 
and who have, in all respects, fully complied with the provisions 
and requirements of such laws, including discovery. 

The same form of procedure in making applications for lease 
should be followed as in other cases, except that, in addition to 
the points referred to in section 3 of any ordinary application, 
an application for a preference right lease should be accompanied 
by a full and detailed showing under oath, duly corroborated, 
of the facts on which the applicant claims a preferred right, to- 
gether with copies of the location notices, abstracts of title, and 
such other evidence as may be deemed necessary to establish the 
claimant's preferred right and entire absence of fraud. Claim- 
ants of such preferred rights to leases should * present same 
promptly ; otherwise the lands may be leased to others, in which 
case any preference rights under this proviso will be deemed to 
have lapsed. 

FEES AND COMMISSIONS. 

Under the authority of section 38 of the Act, the following fees 
and commissions are prescribed for transactions under the Act: 

(a) For receiving and acting on each application for a permit, 
lease, or other right filed in the district Land Office in accordance 
with these regulations, there shall be paid a fee of two dollars 
($2) for every 160 acres, or fraction thereof, in such application, 
but such fee in no case to be less than ten dollars ($10), the same 
to be paid by the applicant and considered as earned when paid, 



454 MORRISON'S OIL RIGHTS 

and to be credited in equal parts on the compensation of the re- 
gister and receiver within the limitations provided by law. 

(&) A commission of one per cent (1%) of all moneys received 
in each receiver's office to be equally divided between the register 
and receiver; such commission will not be collected from the 
applicant, lessee or permittee, in addition to the moneys other- 
wise provided to be paid. 

(c) It should be understood that the commission here provided 
for will not affect the disposition of the proceeds arising from 
operations under the Act as provided in section 35 thereof j also 
that such commission will be credited on compensation of re- 
gisters and receivers only to the extent of the limitation provided 
by law for maximum compensation of such officers. 

Very respectfully, 

Clay Tallman, 
Commissioner. 
Approved : March 11, 1920. 
Alexander T. Vogelsang, 
Acting Secretary. 



CHAPTER 79. 

THE COAL LAND REGULATIONS. 

We print in this chapter the regulations of the department as 
to coal land under the 1920 Act. 

The procedure ordinarily is by petition either for lease or for 
prospecting permit. 

A party desiring to lease coal land, files a petition addressed 
to the department in substantially the following f orm : 

Form of Petition for Coal Lease. 

To the Honorable Secretary of the Interior. 

Washington, D. C. 

Your petitioner, Leverett Davis, a native-born citizen of the 
United States, whose postoffice address is Denver, Colorado, 
respectfully represents : 

That he desires a lease on four contiguous quarter sections 

(describing them) in Township South, Range 

West, containing 640 acres in Carbon County, Wyoming. (If not 
surveyed describe it substantially as in form on page ....)• 

That a mine has been opened about one mile to the north of 
said tract, known as the Pluto Coal Mine and about two miles 
to the east is the Dark Moon Coal mine, both presumably on the 
same deposit which is supposed to underlie the above described 
tract. 

The ground is on a flat sagebrush mesa broken by arroyas. 
The nearest railroad station is the town of W^alcott in said coun- 
ty, distance three-quarters of a mile, which would be the natural 
market or shipping point and from the proposed point of opening 
work on said tract to the railroad station, there is a good dirt 
wagon road. 

So far as known the land contains a bed of bituminous coal 

455 



456 MORRISON'S OIL RIGHTS 

from six to nine feet thick. The coal is noncoking but good for 
all fuel purposes. 

If an analysis of the coal has been made, add paragraph : 

An analysis of the coal from said tract made by Victor Blanc 
of 1709, California St., Denver, Colorado, a reputable chemist 
and assayer, is hereto attached as part of this petition. 

The vein has been opened at two points on the outcrop within 
the tract described, by shallow pits. 

Your petitioner expects to develop the vein by an incline 
driven on its slope at about ten degrees from the horizontal to be 
operated by steam power. He has raised a capital of ten thou- 
sand dollars for developing purposes (of which sum $5,000 is on 
deposit in the bank of Walcott) and expects an average daily 
output of one hundred tons per day. 

Your petitioner is willing to- pay a royalty of five cents per 
ton on the mine run of coal and in the absence of a better bkl 
than his own, if the land is awarded to your petitioner, he will 
within thirty days from auction of lease, execute a lease thereof 
and comply with its terms in good faith. 

Respectfully submitted, 

Leverett Davis. 
(Verify as on page 443). 

The above form has been drafted to closely follow the instruc- 
tions contained in rule 9, 

Prior Equities of Petitioner. 

Rule 4 recognizes the equity of a petitioner who had improved 
or occupied or claimed the land in good faith before the date of 
the approval of the Act in accord with the first of several pro- 
visos in section 2 of the Act. . 

This proviso is an ap})eal to the conscience of the Secretary, 
which would naturally be exercised by accepting a lower royalty 
than would be agreed to if the claimant had no such equity, but 
as the petition does not bring the lease but merely an auction 
to sell a lease to the highest bidder, the reduction of royalty would 
avail to the overbidder who had no equity, the same as to the 
petitioner, and would be of absolutely no value as a recognition 
of his equity. 



COAL LAND REGULATIONS 457 

The notice calling for the auction might quote a lower royalty 
to the petitioner if he became lessee and a higher royalty to all 
other bidders. Then if the bonus offered by the outside bidder 
exceeded that offered by the petitioner the equity would not be 
protected although, such an offer might induce the petitioner to 
raise his bid on the bonus : but by any such procedure the bene- 
fit of his equity would be endangered and perhaps sacrificed. It 
is difficult to say how such equity could be protected by any such 
practice but under the sweeping clause of the section "by such 
other methods as he may by general regulations" adopt, special 
provisions could be made to protect the equity. It has not been 
covered by the rules so far promulgated. 

Opening Coal Lands to Bids. 

It seems under the Act and the regulations that the petitioner 
may select a particular tract and apply for it, or the Secretary 
may of his own volition divide the land into lots and throw the 
locality open to general auction. 

Rule 11 provides for discussion and amendment of the terms 
offered by the petition. When they are approved the auction 
is to be called. The only advantage which the petitioner has 
over others at such auction is that he becomes the bidder if no 
other person offers a higher bonus. 

Draft of the Lease. 

Rule 15 seems to contemplate the preparation or drafting of 
the lease by the bidder according to the form prescribed in rule 
18, altho doubtless the department in the course of its practice 
would furnish printed blanks. The other requirements of the 
intended leases are clearly stated in the same rule. 

Amended Lease. 

There are provisions in the Act, recognized by rule 17, by 
which the lifetime of the lease may be extended and new con- 
tracts executed within the maximum of 2560 acres. 

The "similar procedure" mentioned in the last clause of the 
rule, cannot mean that such land is to be again offered at auction 



458 MORRISON'S OIL RIGHTS 

or let to any person other than the holder of the original lease, 
except possibly as to the additional acreage. 

Construction of Lease. 

The terms of the form of lease set forth at length in rule 18 
are drastic but perhaps no more so than in private leases on eoa! 
land for long terms contemplating large production. 

A very fair construction of such a lease is found in St. Louis 
Union Trust Co. v. Galloway Coal Co., 193 Fed. 106 where the 
right to work by instroke is considered and a forfeiture was de- 
nied where willful violation was not proved. The opinion con- 
siders the effect of faults and squeezes which are to be expected 
in any coal vein and decides generally that where good faith ap- 
pears the covenants of such a lease will not be too severly en- 
forced. 

To comply literally with all the terms of such a lease as is 
printed under rule 18 is practically impossible but it cannot be 
supposed that the government will be less fair than a private 
owner of coal lands. 

Instroke. 

When the question of instroke arises (the right to interlock 
the working of coal mines) we would assume that no distinction 
would be made between the rights of the United States and the 
rights of a private lessor. Instroke is hinted at in section 2 (h) 
of the form although not specifically allowed. But where not 
prohibited it is implied. Schobert v. Pittsburg Coal, etc., Co., 
254 111. 474; Ann. Cas. 1913B 1104, 40 L.R.A.(N.S.) 826, 98 N. 
E. 945; Whalley v. Ramage, 10 Weekly Rep. 315, 8 M. R. 52; 
Jegon v. Vivian, L. R, 6 Ch. App. 742, 8 M. R, 628; Lewis v. 
Fothergill, L. R. 5 Ch. App. 103, 15 M. R. 271. 

Permits. 

Permits to prospect for coal are provided for in the second 
proviso of section 2 of the Act and are recognized in rules 19-24. 

These rules prescribe the procedure to obtain a permit which 
are substantially the same as those detailed for an oil permit. 



COAL LAND REGULATIONS 459 

Under these rules the permittee on development of the coal 
becomes entitled to a lease without any competitive bidding. 

Free Leases. 

The final division of the rules applies to those provisos of the 
Act which allow licenses to small domestic users and to towns 
and cities, without rent or royalty. 

The free coal to individuals or associations but not to corpo- 
rations would doubtless under the construction of section 8 by 
rule 24 allow of full supplies to run any private plant although 
not limited to strictly domestic purposes. 

The department however places a strict construction on the 
municipal leases, not allowing such coal to be sold to any sort 
of factor}', store or plant of any kind. Such a limitation would 
be impossible to enforce. No city could pretend to supply its 
householders with coal and deny it to their stores and small busi- 
ness establishments. 

CIRCULAR NO. 679. 

COAL LAND LAWS AND REGULATIONS. 

(Exclusive of Alaska.) 



p^partment of the interior, 
General Land Office, 
April, 1, 1920. 
Register and Receiver, United States Land Offices. 

Sirs : Under authority of the Act of Congress approved Feb- 
ruary 25, 1920 (Public No. 146^, entitled "An Act to promote 
the mining of coal, phosphate, oil, oil shale, gas, and sodium on 
the public domain," the following rules and regulations are pre- 
scribed for the administration of the provisions of said Act rel- 
ative to coal : 



460 MORRISON'S OIL RIGHTS 

1. Methods of disposition. — Sections 2 to 8, inclusive, of said 
Act authorize the Secretary of the Interior to — 

(1) Divide into leasing units and award leases of coal lands, 
and coal deposits owned by the United States ; 

(2) Issue permits to prospect unclaimed and undeveloped 
areas of coal lands and coal deposits ; and 

(3) Issue limited licenses or permits to prospect for, mine, 
and take for use coal from public lands. 

2. Lands to which applicable. — The Act applies to the coal 
lands, or the deposits of coal, classified and unclassified, owned by 
the United States, including those in national forests, and in- 
cluding the coal deposits reserved under laws authorizing entries 
and patents with reservation to the United States of such de 
posits ; also to coal lands in ceded or restored Indian reservations 
the proceeds from the disposition of which are the property of 
the United States. It does not include land or deposits in (a) 
national parks, (b) forests created under the Act of March 1, 
1911 (36 Stat., 961), known as the Appalachian Forest Reserve 
Act, (c) lands in military or naval reservations, (d) Indian re- 
servations, nor (e) ceded or restored Indian lands, the proceeds 
from the disposition of which are credited to the Indians. 

All permits or leases for the exploration for or development of 
coal deposits under this Act within the limits of national forests 
or other reservations or withdrawals to which this Act is appli- 
cable shall be subject to and contain such conditions, stipulations, 
and reservations as the Secretary of the Interior shall deem nec- 
essary for the protection of such forests, reservations, or with- 
drawals, and the uses and purposes for which created. 

3. Who may take. — Leases and prospecting permits may be 
issued to citizens of the United States, associations of citizens, 
corporations organized under the laws of the United States or any 
State or Territory thereof, and to municipalities. Limited li- 
censes or permits for the mining of coal may be issued to citizens, 
associations of citizens, and municipalities. Leases may also be 
issued to operating railroad companies to mine coal for their 
own use for railroad purposes, subject to certain restrictions 
found in section 2 of the Act. 

4. Equitable lights. — Equitable rights of claimants who, prior 



COAL LAND REGULATIONS 461 

to the date of the Act, occupied and improved coal lands in good 
faith may be recognized in awarding- leases of such lands, in 
which cases the rents and royalties, not less than the minimum 
provided for leases under the Act, will be fixed by the Secretary 
of the Interior. 

5. Repealing and saving clause. — Section 37 of the Act pro- 
vides that hereafter the deposits of coal, phosphate, sodium, oil, 
oil shale, and gas referred to and described in the Act, including 
lands and deposits described in joint resolution of August 1, 1912 
(37 Stat. 1346), may be disposed of only in the manner provided 
in the Act "except as to valid claims existent at date of passage 
of this Act, and thereafter maintained in compliance with the 
laws under which initiated, which claims may be perfected under 
such laws, including discovery." 

As to coal, those claims initiated under the pre-existing law 
may go to patent, which, at the date of the Act, were covered by 
valid coal declaratory statements or applications to purchase 
which are timely followed up and perfected in accordance with 
the controlling coal land laws (sees. 2348 to 2352, Revised Stat- 
utes), and the regulations thereunder (Circular No. 557) ; like- 
wise, one who has opened and improved a mine of coal on un- 
surveyed lands may proceed to perfect his claim within sixty 
days from the filing of the official plat of survey, pursuant to 
section 2349 R, S. 

6. Fees and commissions. — (a) For receiving and acting upon 
each application for a permit, lease, or license filed in the dis- 
trict Land Office in accordance with these regulations, there shall 
be paid a fee of $2 for every 160 acres, or fraction thereof, in 
such application, but such fee in no case to be less than $10, the 
same to be paid by the applicant and considered as earned when 
paid, and to be credited in equal parts on the compensation 
of the register and receiver within the limitations provided by 
law. 

(&) Registers and receivers shall be entitled to a commission 
of 1 per cent of all moneys received in each receiver's office, to 
be equally divided between the register and receiver; such com- 
mission will not be collected from the applicant, lessee, or per- 
mittee in addition to the moneys otherwise provided to be paid. 



462 MORRISON'S OIL RIGHTS 

It should be understood that the commissions herein provided 
for will not affect the disposition of the proceeds arising from 
operations under the Act, as provided in section 35 t thereof : also 
that such commissions will be credited on compensation of re- 
gisters and receivers only to the extent of the limitation provided 
by law for maximum compensation of such officers. 

I. Coal Leases. 

7. Leasing units. — Under section 2 of the Act, no coal land or 
deposits may be leased until after division into suitable leasing 
units or tracts. Such leasing units may be created by the Secre- 
tary of the Interior {a) pursuant to the petition of a qualified 
applicant, that is, qualified to take a lease under the Act, or 
(b) on his own initiative. 

Leasing units will not exceed 2,560 acres in area. All material 
factors, such as character and depth of the coal deposits, topo- 
graphy of the land, situation with respect to adjacent private 
holdings of coal lands, the proximity of rail or water transporta- 
tion, and outlet for other lands in the immediate vicinity, as well 
as the investment reasonably required to provide the requisite 
development and operating facilities, will be given consideration 
in the establishment of leasing units. 

Such leasing units will comprise contiguous tracts, except in 
cases where it appears that noncontiguous tracts can be prac- 
tically worked on a single mine or unit. 

Leasing units may include, in whole or in part, unsurveyed 
land, but a survey of the land will be made and the leasing unit 
conformed to such survey prior to the execution of a lease there- 
of. 

8. Minimum development. — An actual bona fide expenditure 
for mine operation; development or improvement purposes of 
the amount determined by the Secretary, and stated in the lease 
offer hereinafter referred to, is adopted as the minimum basis 
for granting leases, with the requirement that not less than one- 
third of the required investment shall be expended in develop- 
ment of the mine during the first year, and a like amount each 
year for the two succeeding years, the investment during any one 
year over such proportionate amount for that year to be credited 



COAL LAND REGULATIONS 46o 

on the expenditure required for the ensuing year or years. A 
bond executed by the lessee, with approved corporate surety, 
will be required to be furnished, in the sum of $10,000, condi- 
tioned upon the expenditure of the specified amount of invest- 
ment. After said investment has been made a similar bond in 
the sum of $5,000, conditioned upon compliance with the terms 
of the lease, will be required. 

9. Petitions for leasing units. — Any person, association of per- 
sons, or corporation qualified to take a lease may file in the proper 
district Land Office a petition to divide coal lands into leasing 
units for purpose of lease. Such petition should set forth — 

(a) Name and post-office address of petitioner. 

(b) Statement showing qualifications of petitioner to take a 
lease under the Act; proof of citizenship to be made by affidavit 
if native born ; if naturalized, by certified copy (special form for 
land cases) of certificate thereof if copj r is not already on file; 
if a corporation, by certified copy of the articles of incorporation • 
if a municipality, a showing of (1) the law or charter and pro- 
cedure taken by which it became and exists a legal body corpo- 
rate, (2) that the taking of a permit or lease is authorized under 
such law or charter, and (3) that the action proposed has been 
duly authorized by the governing body of such municipality; and 
the applicant must make affidavit that he or it is not disqualified 
to take a permit or lease under the provisions of section 27 of the 
Act. Corporations must also submit a showing as to the resi- 
dence and citizenship of its stockholders. 

(c) Description of the land, by legal subdivisions if surveyed, 
or if not surveyed, by metes and bounds or natural monuments, 
with such particularity as to render possible its identification 
with certainty. Where possible, description of the land by the 
approximate subdivisions of the future survey should be given. 

(d) Statement of the general situation of the land with re- 
spect to other mines, its topography, outlet to market, and trans- 
portation facilities. 

(e) Character and extent of the coal deposits so far as known. 
(/) The contemplated investment for the development and 

equipment of a producing mine of a stated average daily output. 
(g) Maximum royalty petitioner is willing to pay if awarded 



464 MORRISON'S OIL RIGHTS 

lease of the land described in petition, or any specific portion 
thereof, together with a statement by or on behalf of petitioner 
that, in the absence of any better bid for lease of said land, he 
will, within thirty days from auction of lease, execute a lease 
therefor and comply with its terms in good faith. 

10. Action by local office. — Registers and receivers will assign 
current serial numbers to such petitions, promptly note the peti- 
tions on their records, and transmit them to the General Land 
Office with report of the record status of the land described. 

After receipt of such a petition, no filing for any of the land 
described therein will be accepted until so directed, except other 
petitions for dividing into leasing units. 

11. Action on petition. — If the terms offered by the petitioner 
for lease of the land or deposits are considered tentatively ac- 
ceptable as minimum terms for such land or deposits, examina- 
tion, classification, and blocking the land into leasing unit or 
units will be directed. If it be found thereby that the land de- 
sired by the petitioner constitutes a suitable unit, and the terms 
offered by him are considered acceptable therefor, the land or 
deposits will be advertised for lease to the bidder offering the 
highest bonus for such lease on the same terms. But, if it be 
found as a result of such examination and blocking out, that the 
land does not constitute an acceptable leasing unit, or if the roy- 
alty offered, or investment contemplated, is considered inade- 
quate, the petitioner will be so advised, and also of the form and 
area in, which the land or deposits will be leased and the minimum 
terms on the basis of which lease will be offered for sale, where- 
upon the petitioner will be permitted to amend his offer to meet 
the terms required. If the offer is so amended, the leasing units 
will be advertised for lease to the bidder offering the highest bon- 
us for such lease ; but if no bidder offers a bonus for such lease, 
same will be awarded to the petitioner. In case the petitioner 
fails to make a satisfactory minimum lease offer, the leasing 
unit may or may not be offered for lease, in the discretion of the 
Secretary of the Interior. 

12. Notice of offer. — When any coal lands are divided into 
leasing tracts, the appropriate District Land Office will be ad- 
vised thereof whereupon the register will publish a notice for a 



COAL LAM) REGULATION 4(35 

period of thirty days in a newspaper of general circulation m 
the county in which the lands or deposits are situated, of the 
offer of the land for lease, and the date and hour on which bids 
will be received at his office, such date to be not earlier than the 
last day of publication. The notice will describe the land, state 
the amount of royalty and rental to be charged, and the minimum 
investment required, and that the sale of lease will be made at 
public auction at the time fixed to the qualified bidder offering 
the highest bonus for the privilege of leasing the land on the 
terms set forth. A copy of the notice will also be posted in the 
Land Office during publication thereof. Publication of the offer 
will be at the expense of the government. 

All bidders at any public sale of leases are warned against com- 
mitting any act by intimidation, combination or unfair manage- 
ment, to hinder or prevent bidding thereat, in violation of sec- 
tion l 59 of the Criminal Code of the United States, approved 
March 4, 1909. 

13. Auction of lease. — At the time fixed in the notice, the re- 
gister or receiver will, by public auction at his office, offer the 
land or deposits for lease on the terms and conditions fixed in the 
notice to the qualified bidder of the highest amount offered as a 
bonus for the privilege of leasing the land, subject to the ap- 
proval of the Secretary of the Interior. The successful bidder 
must deposit with the receiver on the day of sale a certified 
check or cash, for one-fifth of the amount of his bid, such sum to 
be deposited by the receiver in his account 'Trust funds — 
Unearned money." 

14. Right to reject bids. — The right is reserved by the Secre- 
tary of the Interior to reject any and all bids ; and should a bid 
be rejected, the deposit made by the bidder will be returned. 

*15. Action by bidder. — The successful bidder will be allowed 
thirty days from date of auction within which (a) to file in the 
District Land Office a lease, duly executed by him in triplicate 
in the form herein prescribed (par. 18) ; (&) to file evidence of 
qualifications as prescribed by paragraph 9 (b) hereof, unless 
such evidence has theretofore been filed; (c) to file the bond 
required by section 2 (b) of the lease, or U. S. bonds in lieu 

i R. S. Sec. 2373. Comp. L. Sec. 10226. 
M. 0. R.— 30. 



466 MORRISON'S OIL RIGHTS 

thereof under the Act of February 24, 1919 (40 Stat., 1148) ; 
(d) to pay the remainder of the bonus bid by him and the 
annual rental for the first year of the lease, together with the 
required filing fee of $2 for each 160 acres of land, or fraction 
thereof, but in no case less than $10. 

16. Action by district officers. — At the end of the thirty days 
allowed the successful bidder, or sooner, if the foregoing be com- 
plied with by him, the local officers will forward by special letter 
all papers with full report of action taken. In case of default, 
the amount deposited by the bidder will be forfeited, and dis- 
posed of as other receipts under this Act. 

17. Modifications of leases. — Under section 3 of the Act, where 
a lease has been issued, modifications may be secured to include 
therein additional contiguous coal lands or coal deposits, not 
exceeding a total of 2,560 acres in the lease. Under section 4 of 
the Act, upon satisfactory showing by the lessee that all of the 
workable coal within a tract covered by the lease will be ex- 
hausted, worked out, or removed within three years thereafter, 
additional tracts may be leased, which, including the lands or 
deposits remaining in the lease, shall not exceed 2,560 acres, 
such lease of additional lands to be made under similar procedure 
and on the same conditions as original leases. 

18. Form of lease.— Leases hereunder will be in substance as 
follows : 



U.S. Land Office at. 
Serial No , 



The United States of America, 
Department of the Interior. 

MINING LEASE OF COAL LANDS UNDER ACT OF 
FEBRUARY 25, 1920. 



Date. Parties. 

This indenture of lease, entered into, in triplicate, this 

day of , A. D. 19 , by and between the United 

States of America, acting in this behalf by Secretary 



COAL LAM) REGULATIONS V\l 

of the Interior, party of the first part, hereinafter called the 

lessor, and of party of the second part, 

hereinafter called the lessee, under, pursuant, and subject to the 
terms and provisions of the Act of Congress, approved February 
25, 1920 (41 Stat. — ), entitled "An Act to promote the min- 
ing of coal, phosphate, oil, oil shale, gas, and sodium on the public 
domain," hereinafter called the "Act." 

Purposes. Description of Land. Mining and Surface Rights. 

WITNESSETH : 

That the lessor, in consideration of the rents and royalties to 
be paid and the covenants to be observed as hereinafter set forth, 
does hereby grant and lease to the lessee the exclusive right and 
privilege to mine and dispose of all the coal in, upon, or under 
the following-described tracts of land, situate in the State of 

, to wit : , containing 

acres, more or less, together with the right to construct all such 
works, buildings, plants, structures, and appliances as may be 
necessary and convenient for the mining and preparation of the 
coal for market, the manufacture of coke or other products of 
coal, the housing and welfare of employees, and subject to the 
conditions herein provided, to use so much of the surface as may 
reasonably be required in the exercise of the rights and privil- 
eges herein granted. 

Rights Reserved by Lessor. Easements. 

Section 1. That the lessor expressly reserves : 

(1 a) The right to permit for joint or several use such ease- 
ments or rights of way, including easements in tunnels upon, 
through, or in the land leased, occupied, or used as may be 
necessary or appropriate to the working of the same or other 
lands containing the deposits described in said Act, and the 
treatment and shipment of the products thereof by or under 
authority of the government, its lessees or permittees, and for 
other public purposes. 



46$ MORRISON'S OIL RIGHTS 

Disposition of Surface. 

(1 b) The right to lease, sell, or otherwise dispose of the 
surface of said lands or any part thereof under existing law or 
laws hereafter enacted, in so far as said surface is not necessary 
for the use of the lessee in the mining and removal of the coai 
therein, and to lease other mineral deposits in the lands, under 
the provisions of said act. 

Monopoly and Fair Prices. 

(1 c) Full power and authority to carry out and enforce all 
the provisions of section 30 of said Act to insure the sale of 
the production of said leased lands to the United States and to 
the public at reasonable prices, to prevent monopoly; and to 
safeguard the public welfare. 

Sec. 2. The lessee in consideration of the lease of the rights 
and privileges aforesaid hereby covenants and agrees as follows : 

Investment. 

(2 a) To invest in actual mining operations, development, or 
improvements upon the land leased, or for the benefit thereof, 

the sum of dollars, of which sum not less than one-third 

shall be so expended during the first year succeeding the execu- 
tion of this instrument and a like sum each of the two succeeding 
years, unless sooner expended; and submit annually, at the ex- 
piration of each year for the said period, an itemized statement 
of the amount and character of said expenditure during such 
year. 

Bond. 

(2 b) To furnish a bond in the sum of $10,000, conditioned, 
upon the expenditure of the amount specified in (2 a) hereof, 
and after said investment has been made, a similar bond in the 
sum of $5,000, conditioned upon compliance with the terms and 
provisions of this lease. 



COAL LAND KJ ILLATIONS 469 

Annual Rental. 

(2 c) To pay as an annual rental for each acre or part thereof 
covered by this lease the sum of 25 cents per acre for the first 
year, payment of which amount is hereby acknowledged, the 
sum of 50 cents per acre per year for the- second, third, fourth, 
and fifth years, and $1 per acre for the sixth and each succeeding 
year during the life of this lease, all such annual payments of 
rental to be made to the receiver of the United States Land Office 
of the district in which said land is situated, on the anniversary 
of the date hereof, and to be credited on the first royalties to 
become due hereunder during the year for which said rental 
was paid. 

Royalty. 

(2d) To pay to such receiver a royalty of cents on 

every ton of 2,000 pounds of coal mined during the first twenty 
years succeeding the execution of this lease. Royalties shall be 
payable quarterly within thirty days from the expiration of the 
quarter in which the coal is mined. 

Record of Coal Mined. 

(2 e) To determine accurately the weight of all coal mined 
from the leased premises, and to accurately enter the weight or 
weights thereof in due form in books to be kept and preserved 
by the lessee for such purpose. 

Quarterly Reports. 

(2 f) To furnish quarterly, within thirty days after the ex- 
piration of the quarter, a written report covering such quarter, 
certified under oath by the superintendent of the mine, or by such 
other agent having personal knowledge of the facts as may be 
designated by the lessee for such purpose, showing the number 
of tons of 2,000 pounds of coal mined during the quarter, the 
character and quality thereof, amount of coal and products and 
by-products thereof disposed of and price received therefor. 



470 MORRISON'S OIL RIGHTS 

amount of coal and its products in storage or held for sale, and 
amount used in operations under this lease. 

Annual Reports. 

(2 g) Also to furnish annually, and at such other times as 
the Secretary of the Interior may require, in the manner and 
form prescribed by the Secretary of the Interior, plat, map, or 
tracings showing all development work and improvements upon 
the leased lands, and other related information, with a report 
as to all buildings, structures, or other works placed in or upon 
the leased lands, a statement as to the amount and grade of 
coal produced and sold, and amount received therefor by opera- 
tions hereunder, and, if a corporation, the amount of capital 
stock and list of its stockholders. v 

Mine Maps. 

(2 h) to keep at the mine office clear, accurate, and detailed 
maps, on a scale not more than 200 feet to the inch, in the form 
of horizontal projections on tracing cloth, of the workings in 
each coal bed in each separate mine on the leased lands, a sepa- 
rate map to be made for each such bed, and for the surface im- 
mediately over the underground workings, and to be so arranged 
with reference to a public land corner that the maps can be 
readily superimposed. 

Detailed Map of Workings. 

Each map of the workings in any coal bed shall show the 
thickness of the coal and of partings, and the dip and strike 
of each bed at intervals of 500 feet or less; the location of all 
openings connecting such bed with the workings in any Other 
bed, or with any adjacent mine, or with the surface ; the location 
of all entries, gangways, rooms, or breasts, and all other mine 
openings, shafts, airways, appliances, and devices, constructed or 
placed in the mine or any of the workings thereof; and such 
maps shall also show the elevation relative to sea level or a gov- 
ernment survey corner of the principal points of the various 
beds and workings. 



COAL LAND REGULATIONS 471 



Progress Maps. 



Blueprints or reproductions in duplicate of the maps required 
as aforesaid shall be furnished the lessor when made, and supple- 
mental prints or reproductions in duplicate furnished on or 
before the first day of each suceeeding year, showing the exten- 
sions, additions, and changes since the last map or supplement 
was Submitted. All mine progress maps kept by the lessee shall 
at all times be subject to examination by lessor. 

Royalty on Minimum Production. 

(2 i) That, beginning with the fourth year of the lease, except 
when such operation shall be interrupted by strikes, the elements, 
or casualties not attributable to the lessee, the lessee shall mine 

and pay a royalty on not less than tons of coal per 

year, unless on application and showing made,- operations shall 
be suspended for not exceeding six months at any one time, 
pursuant to section 7 of the Act; or unless the lessee shall pay 
the royalty less rent, on such minimum amount of coal, for one 
year in advance, in which case operations may be suspended for 
that year. 

Assignment of Lease. 

( 2 j ) That the lessee shall not assign this lease or any interest 
therein, nor sublet any portion of the leased premises without 
the written consent of the lessor being first had and obtained. 

Readjustment of Terms. 

Sec. 3. It is mutually understood and agreed that the lessor 
shall have the right to readjust and fix the royalties payable 
hereunder and other terms and conditions at the end of twenty 
years from the date hereof, and thereafter at the end of each 
succeeding twenty-year period during the continuance of this 
lease unless otherwise provided by law at the time of the expira- 
tion of any such period, but in case the lessee be dissatisfied with 
the rate of royalty or other terms and conditioDS so fixed, he may 



\1'1 MORRISON'S OIL RIGHTS 

terminate this lease in the manner and under the conditions pro- 
vided in sections 6 (b) and 6 (c) hereof. 

Sec. 4. This lease is made subject to the following' provisions, 
which the lessee accepts and covenants faithfully to perform and 
observe, unless the laws of the State where the leased land or 
deposits are situated otherwise provide, in which case such State 
laws control: 

Operating* Regulations. 

(4 a) The lessee shall carry out and observe regulations pre- 
scribed by the Secretary of the Interior and in force at the date 
hereof .relative to (1) reasonable diligence, skill, and care in the 
operation of said property in accordance with approved methods 
and practices; (2) the prevention of undue waste; (3) the safety 
and welfare of miners; and (4) insuring the fair and just 
weighing or measurement of the coal mined by each miner. 

Payment of Wages. Freedom of Purchase. Eight-hour Work- 
day. 

(4 b) And also shall pay all miners and other employees, both 
above and below ground, at least twice each month in lawful 
money of the United States, and shall permit such miners and 
other employees full and complete freedom of purchase, but 
with a view to increasing safety this provision shall not apply to 
the purchase of explosives, detonators, or fuses ; and shall not re- 
quire or permit miners or other employees, except in case of 
emergency, to work underground for more than eight hours in 
any one workday, and shall not employ any boy under the age 
of sixteen years, or any girl or woman without regard to age 
in any mine below the surface. 

Inspection. 

Sec. 5. And the lessee also expressly agrees that all mining 
and related operations shall be subject to the inspection of 
authorized reresentatives of the lessor, and that such representa- 
tives, with all proper and necessary assistants, may at all reason- 
able times enter into and upon the leased lands and survey and 



COAL LAND REGULATIONS 473 

I 

examine same and all surface and underground improvements, 
works, machinery, equipment, and operations. 

Examination of Books and Records. 

(5 a) And also shall permit the lessor to examine all books 
and records pertaining to operations under this lease, and to 
make copies of and extracts from any or all of same, if desired. 

Operations on Adjoining Lands. 

(5 b) And also shall permit the lessor or its lessees or trans- 
ferees, with the approval of the lessor, to make and use upon or 
under the leased lands any workings necessary for freeing any 
other mine from water or gas, or extinguishing fires, causing as 
little damage or interference as possible to or with the mine or 
mining operations of the lessee hereunder; provided, that any 
such use by a transferee or other lessee shall be conditioned 
upon the payment to the lessee hereunder of the amount of actual 
damages sustained thereby and adequate compensation for such 
use. 

Result of Forfeiture. 

(5 c) And also shall, at the termination of this lease, as the 
result of forfeiture thereof, pursuant to paragraph (6 d), deliver 
up to the lessor the lands covered thereby, including all fixtures, 
machinery, improvements, and appurtenances, other than strictly 
personal property, situate on any of said lands, in good order 
and condition, so as to permit of immediate continued operation 
to the full extent and capacity of the leased premises. 

Sec. 6. It is further mutually understood and agreed as fol- 
lows : 

Waiver of Conditions. 

(6 a) That the lessor may, in writing, waive any breach of the 
covenants and conditions contained herein, except such as are 
required by the Act, but any such waiver shall extend only to 
the particular breach so waived, and shall not limit the rights 



474 MORRISON'S OIL RIGHTS 

of the lessor with respect to any future breach; nor shall the 
waiver of a particular cause of forfeiture prevent cancellation 
of this lease for any other cause, or for the same cause occurring 
at another time. 

Surrender of Lease. 

(6 b) The lessee may, on consent of the Secretary of the 
Interior first had and obtained, surrender and terminate this 
lease upon payment of all rents, royalties, and other debts due 
and payable to the lessor and upon payment of all wages or 
moneys due and payable to the workmen employed -by the lessee, 
and upon a satisfactory showing to the Secretary of the Interior 
that the public interest will not be impaired ; and the lessee may 
with like consent surrender any legal subdivision of the area 
included within the lease ; but in no case shall such termination 
be effective until the lessee shall have made provision for the 
preservation of any mines or productive works or permanent im- 
provements on the lands covered hereby. 

Privilege of Purchasing Equipment. 

(6 e) That on the termination of this lease, pursuant to the 
last preceding paragraph, the lessor, his agent, licensee, or lessee 
shall have the exclusive right, at the lessor's election, to purchase 
at any time within six months, at the appraised value there- 
of, all buildings, machinery, equipment, and tools, placed by 
the lessee in or on the land leased hereunder, save and except 
all underground timbering, and such other supports and struc- 
tures as are necessary for the preservation of the mine, which 
shall be and remain a part of the realty without further con- 
sideration or compensation; that the purchase price to be paid 
for said buildings, machinery, equipment, and tools to be pur- 
chased as aforesaid, shall be fixed by appraisal of three dis- 
interested and competent persons (one to be designated by each 
party thereto and the third by the two so designated), the 
valuation of the three or a majority of them to be conclusive; 
that pending such election to purchase within said period of 
six months none of said buildings or other property shall be 



- COAL LAND REGULATIONS 475 

removed from their normal position ; that if such valuation be not 
requested, or the lessor shall affirmatively elect not to purchase 
within said period of six months, the lessee shall have the privi- 
lege of removing said buildings and other property, except said 
timbering and other supports and structures, as are necessary for 
the preservation of the mine, as aforesaid. 

Forfeiture. 

(6 d) If the lessee shall fail to comply with the provisions of 
the Act or make default in the performance or observance of any 
of the terms, covenants, and stipulations hereof, or of the general 
regulations promulgated and in force at date hereof, the lessor 
may institute appropriate proceedings in a Court of competent 
jurisdiction for the forfeiture and cancellation of this lease as 
provided in section 31 of the Act, but this provision shall not be 
construed as depriving the lessor of any legal or equitable remedy 
which the lessor might otherwise have. 

Action by Lessor to Prevent Loss or Damage. 

Sec. 7. It is further covenanted and agreed that, should the 
lessee fail to take prompt and necessary steps to prevent loss or 
damrge to the mine, property, or premises, or danger to the em- 
ployees, the lessor may enter on the premises and take such 
measures as may be deemed necessary to prevent such loss or 
damage or to correct the dangerous or unsafe condition of the 
mine or works thereof, which shall be at the expense of lessee. 

Continuing Obligation. 

Sec. 8. It is further covenanted and agreed that each obliga- 
tion hereunder shall extend to and be binding upon, and every 
benefit hereof shall inure to, the heirs, executors, administrators, 
successors, or assigns of the respective parties hereto. 

Unlawful Interest. 

Sec. 9. It is also further agreed that no member of or delegate 
to Congress, or resident commissioner, after his election or ap- 
pointment, or either before or after he has qualified, and during 



476 MORRISON'S OIL RIGHTS 

his continuance in office, and that no officer, agent, or employee of 
the Department of the Interior, shall be admitted to any share 
or part in this lease, or derive any benefit that may arise there- 
from, and the provisions of section 3741 of the Revised Statutes 
of the United States and sections 114, 115, and 116 of the Co- 
dification of the Penal Laws of the United States approved 
March 4, 1909 (35 Stat. 1109), relating to contracts enter into 
and form a part of this lease so far as the same may be applicable. 
In witness whereof — 

The United States of America, 

By 

Secretary of the Interior, Lessor. 



Lessee. 



Witnesses. 



II. Coal Prospecting Permits. 

19. Character of lands. — Permits are authorized by section 
2 of the Act to be issued to qualified applicants to prospect un- 
claimed undeveloped lands where prospecting or exploratory 
work is necessary to determine the existence or workability of the 
coal deposits. 

20. Area. — Permits will be issued for tracts of not exceeding 
2,560 acres of contiguous lands, or, if not contiguous, in ren- 
sonably compact form, considering the reasons for not including 
a contiguous area. Where lands included in a permit have been 
or may be disposed of with reservation of the coal deposits, a per- 
mittee must make full compliance with the law under which such 
reservation was made, reference being made to the Acts of March 
3, 1909 (35 Stat. 844) ; June 22, 1910 (36 Stat, 583) ; December 
29, 1916 (39 Stat. 862), and other laws authorizing such reserva- 
tions. 

21. Bights conferred. — A permit will entitled the permittee 
to the exclusive right to prospect for coal on the land described 



L'UAL LAND KEUl'LATIONS 477 

therein. In the exercise of this right, the permittee shall be au- 
thorized to remove from the premises only such coal as may be 
necessary in order to determine the workability and commercial 
value of the coal deposits in the land. 

22. Application for permit. — Applications for p'ermits shall 
be filed in the proper District Land Office, and, after due nota- 
tion thereof on the record, forwarded to the General Land Office 
with report of status of the land affected. No specific form pf 
application is required and no blanks will be furnished, but it 
should cover, in substance, the following points: 

(a) Applicant's name and address; 

(6) Proof of citizenship and qualifications to take a lease as 
required by paragraph 9 (b) hereof; 

(c) Description of land for which a permit is desired by legal 
subdivision if surveyed, and by metes and bounds and such other 
description as will identify the land if unsurveyed. If unsur- 
veyed, a survey sufficient to identify more fully and segregate 
the land may be required before permit is granted ; 

(d) Condition of coal occurrences, so far as determined; de- 
scription of workings, and outcrops of coal beds, if any, and rea- 
son why the land is believed to offer a favorable field for pros- 
pecting for coal; 

(e) Detailed plan and method of conducting prospecting or 
exploratory operations on the land, estimated cost of carrying- 
out such proposed prospecting operations, and the diligence with 
which such operations will be prosecuted; 

(/) Brief statement of applicant's experience in coal mining 
operations, if any, together with one or more references as to 
his reputation and business standing. 

The application must be- under oath of the applicant, or if a 
corporation, of one of its officers theretofore duly authorized. 

23. F omi of permit. — On receipt of the application, if found 
sufficient and the lands subject thereto, a permit will be issued, 
of which the District Land Office will be advised. Permits will 
be in substantially the following form : 



U. S. Land Office 
Serial No 
The United States of America, 
Department of the Interior. 



478 MORRISON'S OIL RIGHTS 



COAL PROSPECTING PERMIT. 

Know all men by these presents, that the Secretary of the In- 
terior, under and by virtue of the Act of Congress entitled "An 
Act to promote the mining of coal, phosphate, oil, oil shale, gas r 
and sodium on the public domain, approved February 25, 1920 
(Public No. — ), has granted and does hereby grant a permit 

to of the exclusive right for a period of two 

years from date hereof to prospect for coal the following de- 
scribed lands : but for no other purpose, 

under the provisions of said Act and upon the following express 
conditions, to wit: 

1. To begin prospecting work within ninety days from date 
hereof and to diligently prosecute the same during the period 
of such permit in accordance with the following plan : 

2. To remove from said premises only such coal or other ma- 
terial as may be necessary to prospecting work, and to keep a 
record of all coal mined and disposed of, payment of a royalty 
thereon of 25 cents per ton of 2,000 pounds to be made to the 
receiver of the district land office not later than during the 
calendar month succeeding that during which such coal was dis- 
posed of. 

3. To afford all facilities for inspection of the prospecting work 
on behalf of the Secretary of the Interior, and to make report 
on demand of all matters pertaining to the character, progress, 
and results of such work. 

4. To observe such conditions as to the use and occupancy of 
the surface of the land as provided by law, in case any of said 
lands shall have been or may be entered or patented with a res- 
ervation of the coal deposits to the United States. 

Expressly reserving to the Secretary of the Interior the right 
to permit for joint or several use such easements or rights of 
way upon, through or in the land embraced herein as may be 
aiecessary or appropriate to the working of the same, or of other 
lands containing the deposits described in said Act, and the treat- 
ment and shipment of the products thereof by or under authority 
of the government, its lessees, or permittees, and for other pub- 
lic purposes; also reserving to the United States the right to 



COAL LAND REGULATIONS 479 

lease, sell or otherwise dispose of the surface of said lands under 
existing law or laws hereafter enacted in so far as said surface 
is not necessary for the use of the permittee in prospecting here- 
under, and further reserving the right and authority to cancel 
this instrument for failure of the permittee to comply with any 
of the conditions hereof, after thirty days' notice of the reasons 
for such cancellation. 

Valid existing rights acquired prior hereto on the lands do- 
scribed herein will not be adversely affected hereby. 

Dated this day of 19 



• Secretary of the Interior. 
24. Leases to permittees. — A qualified permittee who has 
shown, within the period of the permit, that the land included 
therein contains coal in commercial quantities, will be entitled 
to a lease for such land, or part thereof as the permittee may 
desire, upon due application and publication of notice thereof. 
The application for lease should be filed in the proper district 
Land Office before the expiration of the period of the permit. 
An application for lease under this section should describe the 
land desired, and set forth fully and in detail the extent and 
mode of occurrence of the coal deposits as disclosed by the pros- 
pecting work performed under the permit. Such leases will 
be granted without competitive bidding, on rents and royalties 
to be fixed by the Secretary of the Interior, and otherwise sub- 
stantially in the form of lease provided in section 18 of these 
regulations. 

III. Limited License to Mine Coal 

Under section 8 of the Act, the Secretary of the Interior is 
authorized to issue limited licenses to individuals and associa- 
tions of individuals to mine and take coal for their own use, but 
not for sale, without the payment of any rent or royalty, and 
such licenses may be issued to municipalities to mine and dispose 
of coal without profit to their residents "for household use." 
Attention is called to the fact that, under this section, an indi- 
vidual or association of individuals may mine and take coal un- 
der such a license for his or their own strictly local domestic 



480 MORRISON'S OIL RIGHTS 

needs for fuel, whatever such use may be, but in no case for 
barter or sale; while a municipality may under such a license 
supply coal to its residents for household use only, which ex- 
cludes mining coal by a municipality either for its own use or 
use of its residents other than for household purposes, thus 
barring factories, stores, heating and lighting plants and other 
business establishments. 

25. Area and duration. — (a) A license to an individual or 
association, in the absence of unusual conditions or necessity, 
will be limited as to area to a legal subdivision of 40 acres or 
less; and may be revoked at any time, and such license will 
expire by limitation at the enu 1 of two years from date of issu- 
ance, unless timely renewed on application filed and proper 
showing made prior to expiration of the two-year period. 

(b) Licenses to municipalities are limited as to area by the 
provisions of the Act, as follows : Not to exceed 320 acres for a 
municipality of less than 100,000 population, not to exceed 1,280 
for a municipality of not less than 100,000 and not more than 
150,000 population, and not to exceed 2,560 acres for a munic- 
ipality of 150,000 population or more. Licenses to municipali- 
ties will expire by limitation at the end of four years from date 
of issuance, unless renewed; but every such licensee must make 
to the Commissioner of the General Land Office an annual report 
of all operations conducted under such license. 

26. Application for license. — Application for such limited 
license must be filed in duplicate in the district land office having 
jurisdiction over the land, in the form herein provided. A 
municipality must file with the application a showing of (1) the 
law or charter and procedure taken by which it became and 
exists a legal body corporate, (2) that the taking of a license is 
authorized under such law or charter, and (3) that the proposed 
action has been duly authorized by the governing body of the 
municipality. Appropriate serial number will be assigned to 
such application, notation made thereof on the office records, and 
the application promptly forwarded to the General Land Office 
with report of status of the lands. 

27. Form of application — License. — An application in sub- 
stantially the following form, approved by the Secretary of the 



COAL LAND REGULATIONS 481 

Interior, will constitute the license; one copy will be retained 
for the Land Office records and the other returned to the lieensee. 
Blank forms of applications will be printed and available in the 
district land offices. 

The United States op America, 
Department op the Interior. 

U. S. Land Office at 

Serial No 



APPLICATION FOR LICENSE TO MINE COAL UNDER 
SECTION 8 OF THE ACT OF FEBRUARY 25, 1920. 



19...., 

The Commissioner op the General Land Office, 

Washington, D. C. 

Sir : The undersigned of ., hereby 

appl for a license to prospect for, mine, and remove coal 
from the following described land containing ap- 
proximately acres, situated within the 

land district, State of , and in support of this ap- 
plication make the following representations as to qualifications 
to receive a license 

The . purpose for which the coal mined hereunder is to be 

used is for which approximately tons are 

required annually. 

In consideration of the granting of the license applied for, the 
applicant hereby agrees to the following express terms and condi- 
tions, to wit : 

1. That only so much of the surface of the land as may be 
necessary to prospecting and mining operations hereunder shall 
be used or occupied by said licensee, and the right is reserved by 
the Secretary of the Interior to dispose of any portion of said 
land not already disposed of with reservation of the coal de- 
posits under the Act of June 22, 1910 (36 Stat. 583), or other 
Acts authorizing such disposition, such licensee to observe in 
prospecting and mining operations hereunder all provisions of 
M. 0. R.— 31. 



482 MORRISON'S OIL RIGHTS 

the laws under which any part of the land has been or ma}- here- 
after be disposed of with reservation of the coal deposits therein. 

2. That all prospecting, mining and removal of coal hereunder 
shall be conducted in accordance with approved methods and 
practice, considering the extent of the operation ; that no under- 
ground working shall be abandoned until all the available coal 
is taken therefrom ; that due provision shall be made for the pre- 
vention of fires in the mine or mines opened hereunder and for 
the safety of the miners or other workmen engaged therein, and 
reasonable diligence, skill, and care shall be exercised in all min- 
ing operations hereunder; and shall carry out and observe any 
regulations prescribed by the Secretary of the Interior, and in 
force at the date hereof, relative to the foregoing provisions in 
this paragraph ; and on termination the licensee to leave the 
premises in a safe condition for future mining operations. 

3. That the license is granted for a period of . . . years 

from the date hereof, subject to an extension at the end of such 
period for a like term of years upon application for such exten- 
sion and satisfactory showing as to the mining of coal from the 
land, giving the amount of coal mined, the disposition made 
thereof, the condition of the mine, and the amount of coal re- 
maining in the land which can be mined. 

4. That the right is reserved to cancel and recall this license 
at any time, after thirty days' notice of such purpose, for failure 
to mine and use the coal deposits in accordance with the condi- 
tions and provisions of said Act, or for committing waste or 
other unnecessary damage to the land or the deposits therein, 
for abandonment or nonuse or for other violation of the terms of 
this license ; that in case this license is canceled prior to its ex- 
piration, or expires by limitation, all mining machinery, tools 
and appliances placed thereon by said licensee shall be removed 
within sixty days from date of expiration of notice of such can- 
cellation; otherwise, said machinery, tools, and appliances to be- 
come the property of the United States : Provided, That no un- 
derground support or structure necessary for the preservation 
of the mine shall be removed. 

5. That the right is reserved to the Secretary . of the Interior 
to permit, upon such terms as he may determine to be just, for 



COAL LAND REGULATIONS 483 

joint or several use, such easements or rights of way, including 
easements in tunnels upon, through, or in said lands as may be 
necessary or appropriate to the working of the same, or of other 
lands containing coal, or other deposits described in said Act, 
and the treatment and shipment of the products thereof by or 
under authority of the United States, its- lessees, or permittees, 
and for other public purposes; also the right to dispose of the 
land, or any deposits therein, under laws authorizing such dis- 
position with reservation of the coal deposits to the United States 
and the right to prospect for, mine, and remove the same. 

6. That said permittee, if a municipality, shall submit to the 
Secretary of the Interior annually on the anniversary of the date 
hereof a complete and detailed report of operations under the 
permit, together with a map or maps showing the mine workings, 
giving character and dimensions of underground work per- 
formed, buildings and structures erected, and machinery installed 
during the year, size of the coal vien mined and its dip and strike, 
character of the coal, amount of coal mined, amount on hand or 
in stock and where stored, number of miners employed, total 
amount of wages paid miners and other employees, number of 
other employees, total salaries paid, cost of supplies and other 
operating expenses, amount of coal and its products sold and 
amount received therefor, giving a full statement of the opera- 
tions under the permit. 



Subscribed and sworn to by this, ...... day of 

19 



[Signature of applicant . 
Approved : 



Secretary of the Interior. 
Very respectfully, 

Clay Tallman, 
Commissioner. 
Approved April 1, 3920. 
John Barton Payne, 
Secretary of the Interior. 



484 MORRISON'S OIL RIGHTS 

Petition for Coal Permit. 

Under regulation 22, concerning coal lands, applications foi 
permits are to be filed in the district land office. No specific 
form is required, but the regulation specifies what points shall 
be covered, and refers to paragraph 9 (b) as to proof of citizen- 
ship, and qualifications to take a lease. Paragraph 9 (b) pro- 
vides that the applicant must make affidavit that he is not dis- 
qualified to take a permit or lease under the terms of section 27 
of the act, and that corporations must show the residence and 
citizenship of its stockholders. Section 27 limits the holding of 
more than one coal lease in any one State and limits the rights of 
individuals and corporations to hold stock in other corporations 
which hold leases. An affidavit should therefore accompany the 
petition for a permit in which should be stated the facts peculiar 
to each application. The form of the petition should be sub- 
stantially as follows:— 

PETITION FOR COAL PERMIT. 

To the Hon. the Commissioner of the General Land Office : 

Your petitioner, The Carbon County Coal and Oil Co., respect- 
fully represents. 

1. That your petitioner is a corporation organized under the 
laws of the State of Wyoming, qualified under its Articles to 
lease coal land and to open mines for coal and to ship and sell 
the product of its mines. A duly certified copy of its Articles 
of Incorporation is herewith enclosed marked Exhibit A. 

2. The undersigned Patrick W. Corcoran, President of said 
Company is authorized to make this application and his P. O. 
address and the P. O. address of said Company is Walcott, 
Wyoming, and a resolution of the Board of Directors authoriz- 
ing him to make, verify and present this petition is herewith 

i«o,a*q marked Exhibit B. 

h a Permit is desired consists of 160 acres 
;uarter of Section 7, Township 14 South, 
>th Principal Meridian, in Carbon County, 
160 acres. 
>f coal occurrences so far as determined 



COAL LAND REGULATIONS *Oi> 

on the premises is that there is ocular evidence of the existence 
of a bed of bituminous coal about 9 feet thick showing an out- 
crop at three or more points within said quarter section. The 
only workings are three pits on the outcrop each about four or 
five feet deep exposing the top of the vein, the distance between 
the furthest east and the furthest west pit being about 500 feet 
which indicates the continuity of the vein. Coal also has been 
found on the supposed extension of said vein on the adjoining 
quarter section to the east with surface indications of coal on 
the two quarter sections lying west from the quarter section 
above described. 

5. The detailed plan and method of conducting prospecting or 
exploratory operations on the land is by sinking each of the said 
pits deeper so as to more fully define the outcrop and width of 
the vein and to sink an incline or shaft at some point where the 
vein may be plainly disclosed, convenient for working and ship- 
ping. The cost of carrying out the prospecting operations should 
not exceed $300, which sum the Company has in the bank in 
said Town of Walcott subject to its check and the petitioner 
expects to proceed continuously with all diligence to complete 
the prospecting as soon as the permit is granted. 

6. The petitioner has never mined for coal but its President 
lias had three years experience in actual coal mining and several 
of its officers and stockholders are practical coal miners and for 
references your petitioner gives the Bank of Walcott, its Presi- 
dent and cashier and the International Trust Co. of Denver. 

Respectfully submitted, 

Carbon County Coal and Oil Company. 
By Patrick W. Corcoran, 
President, 
Attest : 

Edwin Lange, 
Secretary. 

State op Wyoming, ) 
County op Carbon. ^ ss * 

Patrick W. Corcoran, being first duly sworn saith, that fee 
is President of the above named Carbon County Coal and Oil 



486 



MORRISON'S OIL RIGHTS 



Company and that he has read the foregoing petition and knows 
the contents thereof and that the same and the matters and 
things therein stated are true of his own knowledge. 

Patrick W. Corcoran. 

Sworn and subscribed before me this 
day of A. D. 19... 

My Commission expires , 



Notary Public. 



EXHIBIT B. 

Copy of Corporate Resolution. 

Resolved that Patrick W. Corcoran, President of the Carbon 
County Coal and Oil Company, is hereby authorized to apply 
to the proper department of the Land Office of the United States 
for coal prospecting permit on the Southwest Quarter of Section 
7, Township 14 South, Range 60 West of the 6th Principal 
Meridian, Carbon County, Wyoming and to make, sign and 
verify all papers required by the Department in aid of such 
application or petition and to receipt for the permit when issued 
and to do all things and sign all papers requested in the premises 
by any Department of the Land Office. 

On motion made and seconded the above resolution was adopt- 
ed by unanimous vote and the Secretary is directed to certify 
this resolution and its passage when and as he may be lawfully 
required. 

Secretary's Certificate. 

The subscriber, Edwin Lange, Secretary of the above named 
company, hereby certifies that the above is a true and correct 
transcript from the minutes of a meeting of the Board of Direc- 
tors of said Company, held at the office of said Company at 
Walcott, Wyoming on the first day of May 1921, duly called 
under its by-laws, at which a quorom of Directors were present, 



COAL LAND REGULATIONS 487 

and that such Resolution has never been revoked or otherwise 
quaified. 

Witness my official signature and the Corporate Seal of said 

Company this day of A. D. 1921. 

Edwin Lange, 
Secretary. 

The form of the permit to be issued upon the foregoing appli- 
cation is printed in regulation 23, page 478. 

Under the Stock Raising Act 39 Stat. L. 862, 40 Stat. L. 
1016, Comp. L. sees. 4587A-4587K, the coal and other minerals 
are reserved to the United States. Circular, 47 L. D. 227. 

The Coal Lands Laws in force July 16, 1918, are printed in 
the compiled laws section 4665-4670. 

Section 4665 provides for patent to coal lands reserving the 
coal. 

Section 4665A provides for the release of such reservation 
where the land has been later classified as non-coal. 

Sections 4666-4668 provide for agricultural entries on Coal 
Lands reserving the coal to the United States, under The Home- 
stead Law, The Desert Land Law, The Carey Act and The 
Reclamation Act, excepting Alaska. 

Section 4668A covers Coal Land in Indian Reservations ex- 
cepting the Five Tribes in Oklahoma. 

Section 4669 provides for selection by the States of isolated 
or disconnected Coal Tracts reserving the coal. 

Section 4670 is confined specially to Alabama. 



CHAPTER 80. 

FORMS OP OIL AND GAS LEASES. 

The Carter .Oil Company Form. 

Indenture, made this day of 19 ...., be- 
tween postoffice , . . . party or parties of 

the first part, designated herein as "lessor," and The Carter Oil 
Company, a corporation of the State of West Virginia, with an 
office at Tulsa, Oklahoma, party of the second part, designated 
herein as "lessee;" 

Witnesseth: That the lessor, for and in consideration of the 

sum of Dollars, in hand paid by the lessee, 

receipt of which is hereby acknowledged, and the covenants and 
agreements herein contained on the part of the lessee to be paid, 
kept and performed, has demised, leased and let, and by these 
presents does demise, lease and let unto the said lessee, its suc- 
cessors and assigns, exclusively, for the sole and only purpose of 
operating for and producing oil and gas thereon and therefrom. 
Together with rights of way, easements and servitudes for pipe- 
lines, telephone and telegraph lines, for tanks, powerhouses, sta 
tions, gasoline plant, and fixtures for producing, treating and car 
ing for such products, and housing and boarding employees, and 
any and all rights and privileges necessary, incident to or con- 
venient for the economical operation of said land alone or con- 
jointly with neighboring lands, for oil and gas, with right for 
such purposes to the free use of oil, gas or water from said lands 
(but not from lessor's water wells) and wood and timber there- 
from for fuel in conducting drilling operations thereon, and 
with the right of removing, either during or ^f ter the term here- 
of, all and any property and improvements placed or erected on 
the premises by the lessee, including the right to pull all casing, 

said land being situated in the County of State of 

, . and more particularly described as follows: 

488 



OIL AND GAS LEASES 489 

(Description) 

To Have and to Hold all and singular the rights and privileges 
granted hereunder, to and unto the lessee, its successors and as- 
signs, for the term of ten years from date hereof, and as much 
longer thereafter as oil or gas shall be produced therefrom, or 
royalties paid hereunder, or as much longer thereafter as the 
lessee in good faith shall conduct drilling operations thereon, and 
should production result from such operations, this lease shall 
remain in force as long as oil or gas shall be produced. Lessor 
hereby releases and waives all rights of homestead, curtesy or 
dower, and warrants to the lessee, its successors and assigns, for 
the full term hereof, the title and possession of said land for 
all purposes herein set forth. 

In consideration of the premises the lessee covenants and 
agrees : 

First: To deliver to the credit of the lessor as royalty, free of 
cost, in the pipe line to which it may connect its wells, the equal 
one-eighth part of all oil produced and saved from the leased 
premises, or at lessee's election, to pay the lessor for such royalty 
the market price prevailing the day the oil is "run into the pipe 
line or storage tanks, in which event settlement and payment 
shall be made by the lessee on the "15th day of each month for 
the royalty so purchased during the preceding month. 

Second: To pay the lessor $250.00 each year in advance for 
the gas from each well where gas only shall be found when the 
same is used off the premises; the lessor, at his sole risk at all 
times, to have gas free of cost from any such well for two stoves 
and all inside lights in the principal dwelling house on said land 
by making his own connection with the well: Provided, should 
this free gas be required to operate said lease, lessor's use there- 
of at the election of the lessee may be discontinued. If casing- 
head gas produced from said land is sold by the lessee, the lessee 
shall pay the lessor as royalty one-eighth of the net proceeds of 
said sales ; if the lessee manufactures gasoline from said casing- 
head gas, then all oils and other materials used to blend said gaso- 
line shall be deducted from the quantity of gasoline marketed, 
and the quantity remaining shall constitute the basis for the 
payment of royalty. The lessee shall pay the lessor a one-eighth 



490 MORRISON'S OIL RIGHTS 

royalty on said quantity remaining at the net price obtained by 
the lessee for the marketed product. All casing-head gas royal- 
ties shall be paid on or before the 25th day of each month for 
royalties accruing during the preceding month. 

Third: If no well is commenced on said land on or before the 
day of , 19 ; this lease shall ter- 
minate as to both parties unless the lessee on or before that date 

shall pay or tender the lessor the sum of 

Dollars ('$ ) in the manner hereinafter provided ; which 

payment or tender shall operate as a rental for twelve months 
from and after the date last above stated, and the same shall 
also cover the right and privilege in the lessee to defer the com- 
mencing of said well during said period of twelve months. In 
like manner and upon like payments or tenders the commence- 
ment of a well may be further deferred for like periods of twelve 
months each successively, during the original term of this lease, 
and the original term hereof is the number of years fixed in the 
habendum clause hereof. Provided, the lessee or the assignee of 
the whole or any part hereof shall have the right to extend this 
lease as to part of the land covered hereby only upon paying such 
proportion of the periodical rental provided for above as the 
acreage to be retained by the lessees or assignee bears to the en- 
tire acreage covered by this lease. Lessor expressly declares that 
the down-payment or bonus received by him for this lease at the 
time of the execution thereof is a good, valid and substantial con- 
sideration, and sufficient in all respects to support each and every 
covenant contained therein, including specifically the option 
granted the lessee to extend this lease from time to time during 
its original term as defined above upon the payment or tender 
of the rentals hereinbefore provided for. Lessee agrees with rea- 
sonable diligence to offset all paying oil or gas wells drilled with- 
in 300 feet of the tract covered hereby, and it is expressly agreed 
that no implied covenants regarding the measure of diligence to 
be exercised by the lessee in the drilling of said land during said 
original term shall be read into this lease, it being the express 
agreement of the parties that the provisions of this paragraph 
specify the exclusive conditions for drilling under which the 
lessee shall lioid this lease ior said original term. 



/ OIL AND GAS LEASES 491 

Fourth: All payments due hereunder shall be made by lessee's 
eheck mailed, postage prepaid, on or before the day such pay- 
ment is due, to lessor at the above postoffice address, or to 

Bank of for deposit to lessor's credit, and 

the lessor, effective for the full term of this lease, hereby makes 
and constitutes said bank or its successors his agent to accept 
all payments due hereunder, and the same shall continue as the 
depository thereof during the life of this lease, regardless of 
changes in the ownership of said land, rentals or royalties. No 
change in the ownership of said land, rentals or royalties shall 
affect or bind the lessee until the purchaser thereof shall exhibit 
to the lessee the original instrument of conveyance, or furnish a 
duly certified copy thereof; such evidence of ownership must be 
supplied at least sixty days before the next succeeding rental 
falls due, otherwise payment of rentals to the purchaser's pre- 
decessor in title shall bind sueh purchaser: Provided, if such 
purchase covers a part of the acreage herein described only, or 
an undivided interest therein,. then the lessee at its election may 
continue to pay the entire rental or royalty to the purchaser's 
predecessor in title. Should suit be brought involving the owner- 
ship of rentals or royalties accruing hereunder, or the validity 
of this lease, or to foreclose a lien or charge against the fee to 
said land, or said rentals or roj^alties, then all payments accru- 
ing hereunder shall be suspended until the final determination 
of such suit : Provided, also, if said land now is or hereafter be- 
comes subject to delinquent taxes, liens of whatsoever nature, 
or other charge which, if unpaid, might defeat lessee's title under 
this lease, the lessee at its election may pay the same with all 
costs and penalties connected therewith, and for money so ex- 
pended shall have a lien on said land, or the lessee at its election 
may deduct such expenditure from any rental or royalties due 
hereunder. Should the lessee drill a dry hole on said land, then, 
beginning twelve months from the next succeeding rental paying- 
date, the lessee shall resume the payment of rentals hereunder, 
otherwise this lease shall terminate as to both parties. This pro- 
vision, however, shall not apply when there is a producing well 
on said land. 

Fifth: If the lessor owns a less interest in the above described 



492 

land than the entire and undivided fee simple estate therein, 
then the royalties and rentals herein provided for shall be paid 
to the lessor only in the proportion which his interest bears to 
the whole and undivided fee. The lessee shall have the right to 
assign this lease or any interest therein, or any portion of the 
acreage covered thereby, in which last event lessee shall be liable 
only for royalties accruing from operations on the acreage re- 
tained by it and be liable only for such proportion of the rentals 
due under said lease as the acreage retained by the lessee bears 
to the entire acreage covered by the lease, and the assignee of 
the lessee shall have correlative rights and privileges with re- 
spect to said royalties and rentals as to the acreage assigned to 
it. The lessee shall pay for damages caused by its operations to 
growing crops on said land, and if requested, shall bury its pipe 
lines below plow depth, and no well shall be drilled nearer than 
200 feet to the house or barn now on said land without lessor's 
written consent. 

Signed and Sealed this day of ,19 

Witnesses : 



p. o. 



P. 

(seal) 

(seal) 

The above is the form of lease used by a well known Oklahoma 
oil company. It has another, differing from the above only in 
changing the annual to a quarterly rent. 

This blank is one which would be used by a large company 
expecting to operate many wells over a wide extent of country, 
as it provides for contingences not likely to often occur and yet 
which might occur: For change of ownership in the land; for 
homesteads, dower and back taxes; for suits that might be 
brought; for partial failure of title in the lessor and other general 
clauses. 

It also contains acknowledgments for Oklahoma, Wyoming and 
Colorado, which indicates the wide field of its operations. 



OIL AND GAS LLAsLJs 493 

This form of lease is carefully drawn to cover most of the con- 
tingencies of an oil and gas contract but an omnibus form for 
use everywhere and under all conditions makes a most cumber- 
some and unlawyerlike document. 

It contains a covenant concerning protection against drain- 
age, which is a covenant that should be inserted or omitted, ac- 
cording to the particular situation of the land demised with ref- 
erence to ownership of adjoining ground. 

In Rose v. Lanyon Zinc Co., 68 Kan. 126, 74 Pac. 625 and 
Pittsburgh, etc., Brick Co. v. Bailey, 76 Kan. 42, 12 L.R.A.(N.S.) 
745, 90 Pac. 803, are found oil and gas leases which have received 
judicial construction and Brown v. Wilson, 160 Pac. 94 (a case 
overruled on its main points) contains a full review of the several 
forms of oil and gas leases. Two other forms are found in Min- 
ing Rights, 15 ed. pp. 674 and 676. 

It will be noted in the above forms that the demising clause is 
of the land itself, and not merely of the right to enter upon the 
land or the right to work it, and yet they have often been con- 
strued as a mere license or as grants of easements. Where the 
lease is upon proven territory or where oil can be expected with 
reasonable certainty the terms are apt to be less liberal to the 
lessee than w T here it is upon new ground commonly called Wild 
Cat. 



Oil .and Gas Lease. Wyoming Form. 

This agreement, Made and entered into this day of 

192 ... by and between 

of County of 

, State of 

part .... of the first part, and 

party of the second part. 

Witnesseth, That the party of the first part, for and in con- 
sideration of the sum of 

DOLLARS 

to him in hand well and truly paid, the receipt of which is here- 
by acknowledged, and in further consideration of the covenants 
and agreements hereinafter mentioned, does covenant and agree 



494 MORRISON'S OIL RIGHTS 

to lease, and by these presents has leased and granted the exclu- 
sive right unto the party of the second part, his heirs or assigns, 
to enter and occupy the premises herein below described, for the 
purposes of operating and drilling for petroleum and gas, to 
lay pipe lines, erect necessary buildings, re-lease and sub-divide 

all that certain tract of land situate in County, 

State of Wyoming, described as follows, to-wit: 

Section , Township , Range 

Containing acres, more or less. 

The party of the second part, his heirs and assigns, to have 
and to hold the said premises for and during the term of three 
years from the date hereof, and as long thereafter as oil or gas 
is produced in paying quantities, or rental paid thereon. 

The party of the second part, his heirs or assigns, agrees to 
give to the party of the first part one-tenth part of the petroleum 
obtained from said premises, as produced in the crude state, the 
said one-tenth part of the petroleum to be set apart in the pipe 
line running said petroleum to the credit and for the benefit of 
the said party of the first part. 

The said party of the first part to fully use and enjoy the 
said premises for the purpose of tillage, except such parts as 
may be necessary for said mining purposes, and a right of way 
over and across said premises to the place of mining or operat- 
ing. 

The said party of the second part is further to have the privi- 
lege of using sufficient gas and water from the premises herein 
leased, to run the necessary boilers and engines, the right to re- 
move all machinery, fixtures and buildings placed on said prem- 
ises by said party of the second part, or those acting under him, 
and is not to put down any well for oil or gas on the lands 
hereby leased within ten rods of the buildings now on said prem- 
ises without the consent of both parties in writing. 

The said party of the second part agrees that the party of the 
first part shall have gas for domestic purposes for one family, 
free of charge, first party paying second party for the necessary 
connections for such purposes, provided sufficient gas be pro- 
duced from the premises over and above that necessary for run- 
ning second party's boilers and engines. 



OIL AND GAS LEASES 495 

It is agreed, That if gas be found in paying quantities, the 
consideration in full to the party of the first part for such gas 
shall be One Hundred Dollars ($100.00) for the gas when util- 
ized and sold off the premises. 

The party of the second part agrees to commence operations 

within and complete a test well within 

from the execution of this lease, or in lieu thereof thereafter pay 

to the said party of the first part Dollars 

per annum, payable annually in advance, until such test well 
is completed. 

The above rental shall be paid to the party of the first part 

in person or by check to his order, deposited in the 

Bank, of Casper, Wyoming. 

And it is further agreed, That the second party, his heirs or 
assigns, shall have the right at any time to surrender this lease, 
then, and from that time, this lease and agreement shall be null 
and void, and no longer binding on either party, and the pay- 
ments which shall have been made shall be held by the party 
of the first part as stipulated damages for the non-fulfillment of 
the foregoing contract; and that all conditions between the par- 
ties hereunto shall extend to their heirs, executors and assigns. 

And the said party of the first part hereby releases and waives 
any and all rights, privileges and exemptions under and by vir- 
tue of the Homestead Exemption Laws of the State of Wyom- 
ing. - , 

And the said , wife of the said , 

upon the consideration aforesaid, does hereby release and for- 
ever waive unto the said party of the second part, his heirs and 
assigns, all her rights of dower and homestead in and to the 
above granted premises. 

In witness whereof, We, the said parties of the first and 
second parts, have hereunto set our hands and seals the day and 
year first above written. 

Signed, Sealed and Delivered in Presence of 

[seal] 

[seal] 



496 MORRISON'S OIL RIGHTS 

Acknowledgment. 

State of Wyoming, J 
County of C 



ss 



I, , a Notary Public, in and for said County, 

in the State aforesaid, do hereby certify that said 

personally known to me as the persons whose names are sub- 
scribed to the annexed Oil and Gas Lease, appeared before me 
this day. in person and acknowledged that they signed, sealed 
and delivered said instrument of writing as their free and vol- 
untary act, for the uses and purposes therein set forth, and 
expressly waived and released all right, title and benefit of 
exemption under any and all Homestead Exemption Laws, so 
called, of said State of Wyoming. 

And I further certify that 

wife of the said 

was by me first examined in reference to the signing and acknowl- 
edging such lease, the nature and effect of said lease being ex- 
plained to her by me, and that she, being by me fully apprised 
of her right, and of the effect of signing and acknowledging said 
lease, did sign the same and did then acknowledge that she freely 
and voluntarily signed and acknowledged the same for the uses 
and purposes therein set forth and expressly waived and re- 
leased all her rights and advantages under and by virtue of 
all laws of said State of Wyoming, relating to the Exemption 
of Homestead. 

Given under my hand and notarial seal, this 

day of , A. D. 19 

My commission expires , 19 . . . 



[N.S.] 



Notary Public. 



The above form of lease is common in Wyoming. It 
contains most of the usual terms but has no reference to 
protection wells and no express warranty. It is condensed in 



OIL AND GAS LEASES 497 

its language but perhaps less objectionable than some of the 
longer forms, especially for a new field where the outcome is 
problematical. It will be noticed that it does not demise the 
land in terms but "the right to enter and occupy" for the pur- 
pose of drilling for petroleum and gas. 

It is impossible to draft any form which will cover all cases 
unless the objectionable form of an omnibus lease is adopted. 
But the following which is framed on the lines of the form on 
page 359 of the Mining Rights, care being taken to omit all of 
the numbered covenants not suited to the expectations of the 
parties and to insert any special covenant demanded by the sit- 
uation — is as nearly a correct form as we can suggest. 

Mining Rights Form. 

This indenture, made this first day of May, in the year of 
our Lord one thousand nine hundred and twenty, between Pat- 
rick W. Corcoran, of Walcott, Wyoming, lessor and Herbert F. 
Savage, of Salt Lake City, Utah, lessee or tenant : 

Witnesseth, that said lessor, for and in consideration of the 
royalties hereinafter reserved and the covenants and agreements 
hereinafter expressed, and by the said lessee to be kept and per- 
formed, hath granted, demised and let and by these presents 
doth grant, demise and let unto the said lessee all the follow- 
ing described real estate situate in the County of Carbon, State 
of Wyoming, to-wit: the North East Quarter of Section 1, Town- 
ship 14 South, Range 60 West of the 6th P. M., containing 160 
acres. 

Always saving, reserving and excepting to the lessor the sur- 
face and the use of the surface for agricultural and residence 
purposes. 

To have and to hold unto the said lessee for the term of two 
years from date hereof and thereafter as long as oil or gas is 
found in paying quantities. 

And in consideration of such demise the said lessee doth cove- 
nant and agree : 

1. To sink at least one well on the demised ground to the 
distance of at least one thousand feet unless oil or gas is found 
within a shorter distance. 
M. 0. R.— 32. 



498 MORRISON'S OIL RIGHTS 

2. And to complete such sinking within six months from the 
date of this lease. 

3. In default of the completion of the well to the depth afore- 
said or until oil or gas is found as aforesaid this lease shall at 
the option of the lessor become null and void and the demised 
premises shall become forfeit to the lessor: 

Provided always, That the payment of $100 rent before the 
expiration of said six months shall allow another period of six 
months for such sinking. 

4. To deliver as royalty to said lessor one-eighth part of all 
oil found in and saved from said land. 

5. In case gas is found in quantities sufficient to pipe or mar- 
ket, the lessee shall pay to the lessor $50 per quarter from date 
when such gas is struck in the well, payable on the last day of 
each quarter: such quarters of year to be calculated from the 
date of this lease. 

6. If either oil or gas is found in paying quantities the lessee 
will forthwith, at his own expense, procure and place on the 
premises tanks, pipes and all other necessary fixtures to econom- 
ically save the product of such well and deliver its product to 
the buyer or carrier of the same. 

7. In case oil is found in paying quantities the lessee will 
keep correct books of account showing the production of each 
well and the disposition of the proceeds thereof, which books 
shall be open to the inspection of the lessor or his agent during 
business hours at all reasonable times. 

8. To deliver upon request to the lessor all the gas he may 
require for use at his buildings, or outbuildings on the premises, 
service pipes and fixtures to utilize the same being furnished 
by the lessor and kept in repair at his own expense. 

9. To not sink any well within one hundred feet of any build- 
ing now erected upon the premises, and to occupy with any well 
including its fixtures (except pipes) not more than one square 
acre. 

10. To bury upon request of the lessor all oil or gas pipes 
used to conduct oil or gas from the premises, and to pay all 
damages done to timber and crops by reason of the burying, 



OIL AND GAS LEASES 499 

repairing or removing of pipe lines over said premises, except 
on the square acre allowed to each well. 

11. The lessee may sink as many wells as he sees fit, paying 
the same royalty, above provided, for each well, and shall have 
the right to subdivide the ground into lots or tracts and to sub- 
lease the whole or any part of the demised premises ; and all fix- 
tures are the property of the lessee or his sub-lessees, with the 
right to remove the same during the term or within a reasonable 
time thereafter. 

12. Delivery to any pipe line or responsible oil buyer of the 
lessor's proportion of the products of the land with instructions 
to pay to the lessor his one-eighth of the gross market price shall 
be full compliance with the above covenant to pay royalty. 

13. The said lessee shall have the right to use free of charge, 
all oil and gas he may need as fuel, and shall have the right to 
dig a surface well for water for his engine. 

14. In case oil or gas is struck on and marketed in paying 
quant it ity from any adjoining land within one hundred yards 
of the exterior boundary of the demised tract the lessee will sink 
an offset well on the demised tract within fifty feet of the 
exterior line of such tract, upon written request and designation 
by the lessor of the point at which any such well is to be sunk, 
unless a well has been already started by the lessee within two 
hundred yards of such foreign well. 

15. The lessor, upon his part, doth covenant and asree that he 
will not sink any well or lease for oil seeking any ground that 
he may own or purchase or control within two hundred yards 
of the exterior lines of the demised tract. 

16. To keep an accurate written log of the sinking of each 
well showing the number of feet sunk each day, the kind of 
strata penetrated, the thickness of each stratum and the depth 
at which struck, and to allow such log to be examined from 
time to time by the lessor and to furnish copies of the same upon 
reasonable request. 

17. And finally, that upon violation of any covenant or cove- 
nants hereinbefore reserved, the term of this lease shall, at the 
option of the said lessor, expire, and the same and said premises, 
with all the appurtenances, shall become, forfeit to said lessor ; 



500 MORRISON'S OIL RIGHTS 

and said lessor or his agent may thereupon, after demand of 
possession in writing, enter upon said premises and dispossess all 
persons occupying the same, or at the option of said lessor the 
said tenant and all persons found in occupation may be pro- 
ceeded against as guilty of unlawful detainer. 

Each and every clause and covenant of this Indenture shali 
extend to the heirs, executors, administrators and lawful assigns 
of all parties hereto. 

In witness whereof, the said parties have hereunto set their 
hands and seals. 

Patrick W. Corcoran (Seal) 
Herbert F. Savage (Seal) 

Special covenants may, of course, be inserted to cover on any 
other point, especially as to the diameter and kind of casing, as 
to supplies to be furnished and payments by installments when 
the lessor stands a part of the expense of sinking, and also a 
reservation of the right to superintend or direct the work but 
such latter reservation is a dangerous clause because it practically 
kills the special terms as to details of work it being always easy 
for the lessee to assert that such details were waived or changed 
by the party in charge as superintendent, adviser or foreman. 

The provisions against the homestead right and dower found 
in many ordinary blanks is in most cases unnecessary and the 
avoidance of useless covenants is an earmark of careful con 
veyancing. 

If an option to purchase is a part of the contract insert after 
covenant No. 17 the following: 

The Option. 

And in consideration of the acceptance of the foregoing lease 
and the expenditures to be made thereunder and the well and 
faithful keeping of the covenants thereof, the said lessee shall 
have the right to purchase the said demised premises by payment 
of the sum of ten thousand dollars on or before the first day 
of May, A. D. 1921, time being of the essence of the contract 
as to such payment. And upon the tender of such payment 



OIL AND GAS LEASES 501 

the lessor will make, execute, acknowledge and deliver at his 
own cost and charges, good and sufficient deed or deeds of war- 
ranty to be delivered to the lessee or such person or company 
as he shall nominate, conveying the said premises clear of 
incumbrance. 

The forfeiture, surrender or termination of the above lease 
for any cause shall render this option void, and the above men- 
tioned payment may not thereafter be tendered. 

Acknowledgment 

Is not required to the lease unless it is intended to place the 
document on record or to comply with some local statute and 
the possession of the lessee is notice to all parties of his rights 
under his papers. If acknowledgment is demanded a form is 
printed on page 496. 

No one form can fitly cover every case and if the parties con- 
sider the property worth the expense of development they should 
consider it worth the fee of a good lawyer to draw the contract, 
for when laymen attempt to use any printed blank or to follow 
printed instructions without legal counsel they are anticipating 
trouble which good professional advice might save them from. 



CHAPTER 81. 

THE WITHDRAWAL LEGISLATION AND THE NAVAL 

RESERVES. 

The withdrawal Acts are interlocked with Statutes concerning 
severance of the mineral and surface title and with the Forest 
Reserves and the Naval Reserves. 

The title and text of the original withdrawal Act, approved 
June 25, 1910, which was of course later in date than the procla- 
mation of 1909, which led up to or induced this withdrawal Act 
and is known as the Pickett Act is printed below. Although 
replete with provisos and references to exceptions and indiffer- 
ent matters, the whole substance of the Act is practically con- 
fined to the words reserving the rights of all persons at the date 
of withdrawal who are in "diligent prosecution of work leading 
to discovery of oil or gas." 

Group Location, Agency, Sufficient Diligence. 

On January 1, 1908, fifteen locators in the name of twenty- 
one persons made two hundred and seven locations, all in the 
same locality, which locations were on March 4, 1908, conveyed 
to Trustees and the Trustees transferred to a corporation. 

Although some of the locators acted as agents for others it 
was in proof that there was an agreement between the locators 
that "no person was to have a larger interest in any one loca- 
tion than that which the law permits." The Court held, citing 
Booh v. Justice Mining Co., 58 Fed. 106 and other cases, that 
the locations by agents were valid. 

Before the locations were made a large fund had been con- 
tributed for the development of the property, timber had been 
delivered on the claim for a drilling rig, a complete outfit cost- 
ing $7,500 had been ordered and the work was continuous and 
uninterrupted until December 25, 1918, when oil was struck. 

502 * 



WITHDRAWAL LEGISLATION 503 

The ground in controversy was within the withdrawn area of 
September 27, 1909. 

Even if the locators did not intend to develop the whole two 
hundred and seven claims such fact would not affect the va- 
lidity of the claim in controversy on or for which the work above 
mentioned was made. U. S. v. Dominion Oil Co., 264 Fed. 955. 

The Original Withdrawal Act. 

An Act to authorize the President of the United States to 
make withdrawals of public lands in certain cases. 

Authority to Withdraw. 

That the President may, at any time in his discretion, tem- 
porarily withdraw from settlement, location, sale, or entry any 
of the public lands of the United States including the District 
of Alaska and reserve the same for water-power sites, irrigation, 
classification of lands, or other public purposes to be specified in 
the orders of withdrawals, and such withdrawals or reservations 
shall remain in force until revoked by him or by an Act of Con- 
gress. 36 Stat. L. 847, Comp. L. § 4523. 

Only Coal, Oil, Gas and Phosphates Covered. 

Sec. 2. That all lands withdrawn under the provisions of this 
Act shall at all times be open to exploration, discovery, occupa- 
tion, and purchase, under the mining laws of the United States, 
so far as the same apply to minerals other than coal, oil, gas, and 
phosphates : 

Rights of Oil Seekers Preserved. 

Provided, That the rights of any person who, at the date of 
any order of withdrawal heretofore or hereafter made, is a bona 
fide occupant or claimant of oil or gas bearing lands, and who, 
at such date, is in diligent prosecution of work leading to discov- 
ery of oil or gas, shall not be affected or impaired by such order, 
so long as such occupant or claimant shall continue in diligent 
prosecution of said work : 



504 MORRISON'S OIL PJGHTS 

Claims Initiated after Withdrawal. 

And provided farther, That this Act shall not be construed as 
a recognition, abridgment, or enlargement of any asserted rights 
or claims initiated upon any oil or gas bearing lands after any 
withdrawal of such lands made prior to the passage of this Act: 

Agricultural Entries Protected. 

And provided further, That there shall be excepted from the 
force and effect of any withdrawal made under the provisions 
of this Act all lands which are, on the date of such withdrawal, 
embraced in any lawful homestead or desert-land entry thereto- 
fore made, or upon which any valid settlement has been made and 
is at said date being maintained ar d perfected pursuant to law ; 
but the terms of this proviso shall not continue to apply to any 
particular tract of land unless the entryman or settler shall con- 
tinue to comply with the law under which the entry or settlement 
was made : 

New Forest Reserves Prohibited. 

And provided further, That hereafter no forest reserve shall 
be created, nor shall any additions be made to one heretofore 
created within the limits of the States of Oregon, Washington, 
Idaho, Montana, Colorado, or Wyoming, except by Act of Con- 
gress. 36 Stat. L. 847, Comp. L. § 4524, amended as noted below. 

Withdrawals to Be Reported. 

Sec. 3. That the Secretary of the Interior shall report all 
such withdrawals to Congress at the beginning of its next regular 
session after the date of the withdrawals. Approved, June 25, 
1910. 36 Stat. L. 847, Comp. L. § 4525. 

Its Enactment and Provisos. 

The Act above printed followed the withdrawal proclamation 
of September 27, 1909. 

Like many other Acts of Congress it is confused by numerous 
provisos and reference to things not connected with the princi- 



WITHDRAWAL. LEGISLATION 50;') 

pal subject matter of the Act. There are four provisos in its 
section 2. 

Its first section declares that public lands may be withdrawn 
from settlement and sale by order of the President. 

The first clause of its second section, which is the material sec- 
tion, allows the lands so withdrawn to remain open for mineral 
locations except as to coal, oil, gas and phosphates. 

Its first proviso protects bona fide occupants of oil or gas bear- 
ing lands in diligent prosecution of work leading to discovery. 

Its second proviso is a deprecatory clause of non-recognition 
of asserted rights initiated after the date of the withdrawal of 
such lands. 

The third proviso is an exception on behalf of agricultural 
interests. 

The last proviso, having no reference to the substance of the 
Act forbids the further creation of Forest Reserves except by 
Act of Congress. 

Amendment of 1912. 

The Act of August 24, 1912, 37 Stat. L. 497, substitutes the 
.second section of the 1910 Act: It is practically a verbatim re- 
pilition of the section. Instead of saying that the land is open 
to all minerals except coal, oil, gas and phosphates, it says that 
they shall be open to the discovery and entry of metaliferous 
minerals and cuts out California from the list of States where 
uew forest reserves were forbidden. 

These two Acts constitute the legislation commonly called the 
Pickett Act. 

Relief Acts. 

The Act of March 2, 1911, 36 Stat. L. 1015, declares that no oi! 
or gas patent should be refused because of any transfer prior to 
discovery but does not apply to withdrawn lands. The necessity 
for any such Act is not apparent and further it was entirely re- 
trospective, covering only claims located before the date of its 
passage. 



506 " MORRISON'S OIL RIGHTS 

On August 25, 1914, 38 Stat. L. 708, was passed an amendment 
to the above cited Relief Act. 

It is allowed the Secretary of the Interior to enter into agree- 
ments for the disposition of the production of the well until final 
determination of the title and seems to be confined to the oil and 
gas only, and not to cover the title to the well itself. And such 
products must have been from wells on withdrawn lands on 
which discovery had been made before the passage of the Act or 
on which drilling was in progress on October 3, 1910. 

The only practical benefit that can be gathered from these 
Acts of 1911 and 1914, the text of which is printed below, as to 
the holders of claims on withdrawn lands, would seem to be 
that they amount to a condonation of the original trespass. There 
were no prohibitions of transfers of interests in placer claims 
either before or after discovery, as seems to have been assumed 
in the 1911 act. This 1911 Act expressly excludes withdrawn 
lands from its operation while the 1914 Act includes such with- 
drawn lands. The 1911 Act is mentioned in Section 18 of the 
Oil Leasing Act of 1920 referring to the disposition of the 
impounded proceeds but not to any disposition of the title. 

The So-Called Relief Acts of 1911 and 1914. 

An Act to protect the locators in good faith of oil and gas 
lands who shall have effected an actual discovery of oil or gas 
on the public lands of the United States, or their successors in 
interest. 

Be it enacted by the Senate and House of Representatives of 
the United States of America in Congress assembled: 

Prior Transfers of Oil Claims Validated On Withdrawn Lands. 

That in no case shall patent be denied to or for any lands 
heretofore located or claimed under the mining laws of the 
United States containing petroleum, mineral oil, or gas solely 
because of any transfer or assignment thereof or of any interest 
or interests therein by the original locator or locators, or any of 
them, to any qualified persons or person, or corporation, prior 
to discovery of oil or gas therein, but if such claim is in all other 



WITHDRAWAL LEGISLATION 507 

respects valid and regular, patent therefor not exceeding one 
hundred and sixty acres in any one claim shall issue to the 
holder or holders thereof, as in other cases: 

Withdrawn Lands Excepted. 

Provided, however, That such lands were not at the time of 
inception of development on or under such claim withdrawn 
from mineral entry. Approved March 2, 1911, 36 Stat. L. 1015. 

The Second Act was passed with the Title. 

Chap. 287. — An Act To amend an Act entited "An Act to 
protect the locators in good faith of oil and gas lands who shall 
have effected an actual discovery of oil or gas on the public lands 
of the United States, or their successors in interest," approved 
March second, nineteen hundred and eleven. 

Be it enacted by the Senate and House of Representatives of 
the United States of America in Congress assembled: 

That an Act entitled "An Act to protect the locators in good 
faith of oil and gas on the public lands of the United States, or 
their successors in interest," approved March second, nineteen 
hundred and eleven, be amended by adding thereto the following 
section : 

Agreements for Impounding* Oil Proceeds Pending Contro- 
versies. 

"Sec. 2. That where applications for patents have been or 
may hereafter be offered for any oil or gas land included in an 
order of withdrawal upon which oil or gas has heretofore been 
discovered, or is being produced, or upon which drilling opera- 
tions were in actual progress on October third, nineteen hundred 
and ten, and oil or gas is thereafter discovered thereon, and 
where there has been no final determination by the Secretary of 
the Interior upon such applications for patent, said Secretary, 
in his discretion, may enter into agreements, under such con- 
ditions as he may prescribe with such applicants for patents in 
possession of such land or any portions thereof, relative to the 
disposition of the oil or gas produced therefrom or the proceeds 
thereof, pending final determination of the title thereto by the 



508 MORRISON'S OIL RIGHTS 

Secretary of the Interior, or such other disposition of the same 
as may be authorized by law. 

Navy Petroleum Fund. 

Any money which may accrue to the United States under the 
provisions of this Act from lands within the naval petroleum 
reserves shall be set aside for the needs of the navy and de- 
posited in the treasury to the credit of a fund to be known as 
the Navy Petroleum Fund, which fund shall be applied to 
the needs of the navy as Congress may from time to time direct, 
by appropriation or otherwise." (As amended Aug. 25, 1914, 
38 Stat, at L. 708.) 

Naval Reserves Royalty. 

It protects any money received under such settlement from oil 
on the Naval reserves by applying it to the navy petroleum fund. 

Severance of Surface and Mineral Estates. 

The Act of July 17, 1914, 38 Stat. L. 509 provides for agricul- 
tural entries of the surface of lands, withdrawn or classified as 
phosphates, nitrates, potash, oil, gas or as asphaltic minerals or 
which were valuable for such deposits, reserving the minerals 
to the United States, which was perhaps the first serious attempt, 
not locally limited, to sever the surface title from the mineral 
title in disposing of the public domain. It anticipates and pro- 
vides for the right to prospect under the surface and for some 
of the incidents necessarily attaching to such severance. Comp, 
L. §§ 4640 A-C. 

Potash. 

The surface of potash land may be patented under the non- 
mineral land laws of the United States under the Act of July 
17, 1914, 38 Stat. L. 509 reprinted as sections 4640A-4640C. of 
the Compiled Laws. 

A special Act of January 11, 1915, 38 Stat. L. 792, Compiled 
Laws, section 4640D, allows the patenting of phosphate claims 



WITHDRAWAL. LEGISLATION 509 

made before the date of the Act, as placer locations, if not on 
withdrawn lands. Without the aid of such Statute, if valid as 
to notice, staking and record, they could be patented as ordinary 
Placer claims. 

By the Act of October 2, 1917, 40 Stat, L. 297, Compiled Laws 
section 4640E-4640K, the Secretary of the Interior is authorized 
to issue two year permits to prospect for chlorides, sulphides, 
carbonates, borates, silicates or nitrates of potassium (except 
Searles Lake, California) : The area not to exceed 2560 acres. 

The Secretary is authorized to prescribe rules' and regulations 
under which authority Circular No. 594 was issued March 21, 
1918. 

Special provision is made in the Act for leases on the Searles 
Lake deposit and for leases in Sweetwater County, Wyoming. 
Outside of these local exceptions, the general tenor of the Act 
is to allow the issue of permits, to be followed by leases, reserv- 
ing the surface to the United States. The Act seems to have 
been a war measure and its section 13 provides that the President 
should regulate the price of the mineral and prevent its exporta- 
tion from the United States with other obscure reservations and 
the leasing Act of 1920 in its phraseology seems to have been 
framed largely upon this Act. 

Said circular 594 contains the usual regulations with form of 
application for lease and the form of the lease and permit for 
camp site or refining works. 

Sec. 3, of the Act of July 17, 1914, 38 Stat. L. 509, providing 
for surface patents on withdrawn lands reserving the minerals 
to the United States, does not cover lands reserved for the use 
and benefit of the Navy. In re State of California, 44 L. D. 127. 

The form of bond to a party taking the mineral title where 
the surface has been entered by another is found in 47 L. D. 
245. 

Utah Severance Act. 

The Act of August 24,. 1912, 37 Stat. L. 496, is a special Act 
allowing agricultural entries of the surface of oil and gas land 
covered by withdrawals confined to the State of Utah. Comp. 
L. §§ 4638, 4639. 



510 MORRISON'S OiL RIGHTS 

Idaho Act. 

The Act of February 27, 1913, 37 Stat. L. 687 is a special Act 
allowing the State of Idaho to accept the surface title to certain 
lieu tracts on the withdrawn area, reserving the phosphates and 
oil to the United States. Comp. L. §§ 4863-4865. 



THE FOREST RESERVES. 

The Appalachian Forest Act 

Is thrust into a prominent position by its mention in the first 
sentence of the Leasing Bill. It obtains its name from the 
generic word covering the series of low ranges of mountains 
extending from Canada to Alabama. 

It is supposed to apply to water sheds which cover more than 
one State and its provisions allow such States to enter into 
compacts to conserve the water. This was to comply with section 
10 of Article 1 of the Federal Constitution which says: "No 
State shall without the consent of Congress enter into any agree- 
ment or compact with another State." The general power given 
by the Act to enter into such compacts apparently sets aside 
the Constitution which would seem to mean that express consent 
should be given to each several compact. However that may be 
we do not know that it has been so far questioned. 

It provides for co-operation between the Secretary of Agri- 
culture and the States for protection against Forest fires, and 
for the purchase of lands necessary to protect the navigation 
of streams. Lands so purchased are to .become National Forests 
and a class of National Forests which are not allowed to be per- 
mitted or leased as oil lands. 

Under this Act according to the Use Book of 1918 about one 
million acres have been purchased and constituted into National 
Forests situate in Alabama, Georgia, Maine, New Hampshire, 
North Carolina, South Carolina, Tennessee, Virginia and West 
Virginia, in most of which States little or no oil has ever been 
found. That the purchase of land under this Statute would 
protect the water sheds is a far call but some color had to be 



WITHDRAWAL LEGISLATION 511 

given to the Act to bring it within Constitutional powers. With 
its amendments it is found in sections 1574-1587B of the Com- 
piled Laws. 

National Forests. 

The withdrawal of land for Forest Reserves began in 1891 
and the name was changed to National Forests in 1905. The 
location of mining claims on such Forests has never been for- 
bidden and, except the Appalachian Forests, they come under 
the terms of the 1920 Act so that the existence or supposed 
existence of oil on a Forest Reserve does not debar obtaining 
permit and lease. The details of their conservation are regulated 
by the Use Book which goes into minute detail and placer loca- 
tions always have been, and doubtless leases and permits will 
continue to be, liable to constant inquisition from the Forest 
Rangers. On Pages 419-422, of the Mining Rights is found a 
history of the origin and progress of the Forest Reserves. The 
Statutes in force are reprinted as Title XXXIIA of the Compiled 
Laws, 1918. The land withdrawn as National Forest is about 
equal to the area of the State of Texas and they include large 
tracts above timber line. 

Administration. 

The administration of the National Forests is divided. The 
chief control is given to the Department of Agriculture until it 
comes to passing title to tracts within their bounds, when the 
office of the Interior Department attaches. 

The Rules and Regulations are those issued from the former 
but they are not left without mention in the Land Office rules 
and the two sets of Rules as to Timber at least do not fully 
agree : L. 0. Rule 114, Citing Comp. L. Sec. 5133. 

Where a divided dominion exists controversies will arise and 
each interested party will stretch to the limit its assertion of 
power. Considerable correspondence on this point is scattered 
through the Land Decisions. 

The rules of the Department of Agriculture are to a certain 
extent but not fully, set forth in the Use Book and they make 



512 MORRISON'S OIL RIGHTS 

a compilation covering many topics including fire protection, 
preservation of timber from destruction by trespass or by in- 
sects, illicit sales of timber, the water, national monuments, 
antiquities, grazing, hunting and fishing and the preservation 
of the game. 

These forests as to lands purely agricultural are subject to 
entry and rights of way over them are provided for but we 
have no concern with them except as to mineral rights. 

Mining Claims in Reserves. 

The limits between the two jurisdictions are considered in 
Instructions to the Commissioner of the General Land Office, 34 
L. D. 64, and in correspondence between the two secretaries in 
33 L. D. 609, in re Letter of Secretary Hitchcock, but they do 
not clearly define such limits. 

"There is no restriction whatever on going on the National 
Forests and locating mining claims. No permit is necessary." 
Use Book, page 151. 

The above quoted concession is merely an admission of an 
undisputed fact, announced in the Statutes and will doubtless 
apply to all entries for the purpose of securing permits or leases 
on oil and gas and the other minerals enumerated in the Leas- 
ing Act of 1920. 

But the department of the Interior claims the right to enquire 
into the good faith of prospectors and locators, which leads to 
friction between the mineral seeker and the government. United 
States v. Lavenson, 206 Fed. 755. 

Evidence — Mineral Value. 

In a contest as to oil value of lands the evidence is not to be 
confined to the particular Quarter Sections involved but may 
extend to the surface indications and the oil production of sur- 
rounding and adjacent lands. The lands in controversy were 
held to be mineral. Kern Oil Co. v. Clotfelter, 33 L. D. 291. 

Where in a Forest Reserve case the issue is mineral vel non, 
mineral means va^able mineral and the use of the word "valu- 



WITHDRAWAL LEGISLATION 513 

able" qualifying- "mineral" is maintained. In re Cook, 33 L. D 
109. 

The details of these regulations amount to a code of procedure 
declaring even the different measure of damages in the several 
sorts of trespass cases, which is purely a judicial question. And 
that they encroach dangerously close to the assumption of legis- 
lative and judicial powers which cannot be delegated to a de- 
partment, is apparent to every lawyer familiar with land office; 
practice. 

Power of Department to Regulate. 

The National Forests Acts came up for consideration by the 
Federal Supreme Court in Light v. United States, 220 U. S. 
523, 55 L. ed. 570, 31 Sup. Ct. Rep. 485. The Court upheld 
without further argument the position taken in V. S. v. Grimaud, 
220 U. S. 506, conceding practically unlimited power to the 
Department to make and enforce rules and regulations. The 
appellant had allowed his cattle to range where they would 
naturally drift within a Forest Reserve against which he had 
been enjoined by the Circuit Court. The appellate Court held 
that there was no constitutional restriction against withdrawing 
large bodies of land from settlement and that Congress can deal 
with the public lands "precisely as an ordinary individual may 
deal with his farming property." The only restriction conceded 
was in a quotation from Van Brocklin v. Tennessee, 117 U. S. 
158, that the United States "do not and cannot hold property as. 
a monarch for private or personal purposes." This quotation 
is of course^ inconsistent with the cited proposition that it may 
deal with such land precisely as an ordinary individual, but the 
apparent contradiction disappears on consideration of the fact 
that the United States is acting in a governmental capacity for 
the benefit of the entire body of citizens. 

The history of the Public Domain illustrates the expression 
that extremes meet and the statement, paradoxical but true, that 
two parties travelling in opposite direction may arrive at the 
same point. The Public Domain, when the settlement of the 
Great West began, was as free to the American citizen as the 
M. O. R.— 33. 



514 MORRISON'S OIL RIGHTS 

Garden of Eden to Adam at the first creation. Everything 
that he found was his and was given to the first comer by the 
Government, subject only to the ordinary rules of order to 
prevent unseemly strife. The land, the water, the timber, the 
minerals, he obtained almost without cost and by a simple pro- 
cedure. 

Now everything is changed; wherever he goes there are re- 
strictions. A country too much governed is in as bad a con- 
dition as a country without any government at all. There could ' 
be no greater contrast between the Republic of the United States 
and the Empire of Russia and yet we have reached a state of 
affairs where there is but little difference. The delegation of 
power to departments, the creation under these departments of 
an army of officers, with the right to arrest and imprison with 
almost the power to finally condemn, is a practical deprivation 
of liberty and the secret service of the United States in the 
number of its employees and the millions of dollars expended to 
enforce it, surpasses the spy system of Russia in its days of 
imperial power. 

In United States v. Northern Pacific By. Co. 264 Fed. 898, 
the Government had attempted to withdraw lands, not yet 
selected by the Company but upon which the right of selection 
had vested. The court held that the Government cannot with- 
draw land for National Park purposes on which a railroad 
grant company, had at the time of the withdrawal, the right to 
select lieu lands. It cannot for such purpose withdraw indem- 
nity lands, in violation of the contract which the Acts of Con- 
gress amount to, vesting property rights in its grantees. 

THE NAVAL RESERVES. 

These are lands withdrawn by order of the President on the 
recommendation of the Secretary of the Interior and such re- 
commendation is based on the suggestion of the geological sur- 
vey. 

The description of the lands so withdrawn is forwarded to the 
proper local Land Office, so as to become a record accessible to 
interested parties. 



WITHDRAWAL LEGISLATION 515 

Area of the Reserves. Relation to the Leasing Act. 

There were so withdrawn up to October 1, 1919, sixty-four 
petroleum reserves covering millions of acres and up to the same 
date there had been forty restorations of comparatively small 
portions of this immense area. These naval reserves are studi- 
ously excepted from the operation of the Leasing Act. Its first 

section reads "excluding lands withdrawn or reserved 

for military or naval uses or purposes except as hereinafter pro- 
vided." The area of land covered by military reservation is, as 
lias been stated, not extensive. 

The area covered is found in Arizona, California, Colorado, 
Louisiana, Montana, North Dakota, Utah and Wyoming, and the 
whole of the oil lands in Alaska. The few tracts withdrawn 
in Oregon and New Mexico have been restored. 

Section 18 covering claims on withdrawn land forbids leases 
on any naval petroleum reserves, but by a later clause in the 
same section, seems to allow them, as to the producing wells. 

Section 35 contains a special provision for the disposition of 
royalties from the naval reserve lands. 

History of the Reserves — Bulletin 623. 

In Bulletin No. 623, published in 1916, is found a complete 
history of the origin and progress of these reserves. 

The same bulletin presents the arguments defending these re- 
serves which arguments we do not pretend to dispute. The 
reasons, which the bulletin claims to amount to absolute necessity, 
are cogent and the threatened waste and destruction of the oil 
supplies are strongly stated. The bulletin fairly admits that 
private loss amounting to immense sums of honestly invested 
capital became a permanent loss. 

The first suggestion of such withdrawals, if suggestion it could 
be called, occurred as early as January 5, 1865, being a letter to 
the Commissioner of the General Land Office informing him of 
the existence or supposed existence of extensive petroleum values 
in California. The department immediately acted on the letter 
by withdrawing the suspected ground from entry, followed by 
other withdrawals in California, Oregon and Wyoming. There 



516 MORRISON'S OIL RIGHTS 

were withdrawals and cancellations of withdrawals sporadically, 
prior to September 27, 1909, on which date there came the sweep- 
ing order of the President followed by the Act of June 27, 1910. 
The power of the President to withdraw without Congressional 
action was affirmed by the Federal Supreme Court as noted on 
page 255. 

The amount of oil Territory withdrawn by these reserves is 
so great that it should supply the wants of the navy for an un- 
told number of years, the withdrawals under color of supplying 
"he needs of the navy, being really intended for general conserva- 
tion, to prevent the extraction of the oil during the present gen- 
eration and to anticipate the time when the world will have 
greater need for supplies which will soon be in sight of their 
point of exhaustion. 

The totals of the acreage withdrawn by States, are given on 
page 25 of said bulletin 623 the aggregate reading 5,587,077 
acres, the larger withdrawals being in California and Utah, with 
comparatively small amounts in Colorado and North Dakota. 
The withdrawals are by sweeping description so that on their 
face they cover a large acreage already patented or excluded by 
railroad grants, locations and other vested rights. 



CHAPTER 82. 

TEXAS. 

The State of Texas owns its own Public Lands and does not 
come under the provisions of the Oil Leasing Act, nor in fact 
under any of the Congressional Acts or Departmental Regu- 
lations. 

It has a Leasing system of its own, but practically has sur- 
rendered control of its Oil and Gas Lands to the Railroad Com- 
mission. The material statutes concerning this commission are 
printed below, and also the regulations. The Acts of 1917, Pages 
58 and 382, of the Session Laws, arc the latest Statutes on the 
carrying out of its Leasing system. 

By Act of March 17, 1919 quarterly reports are required of 
Oil Operators and a tax of li per cent, on the product is levied. 
Acts of 1919, Regular Session, Page 128. 

An Act was approved July 23, 1919, Special Session Laws, 
Page 51, providing for the leasing of the Oil and Gas rights of 
the State in its Salt-water land and unsurveyed school land. 

On February 17, 1919 the following Act was passed by adding 
a section numbered 78 of the Corporation chapter: 

Drilling Corporations. 

"A private corporation may be formed and chartered for the 
establishment and maintenance of drilling companies, with au- 
thority to own and operate drilling rigs, machinery, tools and 
apparatus necessary in the boring, or otherwise sinking of wells 
in the production of oil, gas or water, or either, and the purchase 
and sale of such goods, wares and merchandise used for such 
business, and declaring an emergency." Acts of 1919, Regular 
Session, Page 8. 

This Section seems to be confined to drilling companies as 
distinguished from mining companies. 

517 



518 MORRlbON'JS OIL KIGHTb 

By Act of March 24, 1919 an Act was passed allowing cities 
and towns "to lease such oil lands as they might own. Acts of 
1919, Regular Session, Page 183. 

By the Act of M^arch 24, 1919, the mineral rights of the State 
in certain school and other public lands were released. Such 
lands had been sold without reserving minerals and the statute 
was passed to prevent any claim that they should have been 
reserved. Acts of 1919, Regular Session, Page 188. 

By Act of March 24, 1919, Guardians were authorized to 
petition for permission to lease the mineral rights of their wards, 
Acts 1919, Regular Session, Page 185. Another Act of the same 
date, Pag^ 251, provides for the leases of the Oil and Gas rights 
of deceased persons. 

By Act approved April 3, 1919, Regular Session, Page 311, 
the practice in injunction cases against oil wells is regulated, 
which Act reads as follows: 

Bonds and Receiver in Injunction Suits. 

Article 4643A. No injunction or temporary restraining order, 
shall be issued by any judge of this State prohibiting any sub- 
surface drilling or mining operations on the application of any 
adjacent land owner, claiming injury to his surface or improve- 
ments, or loss of, or injury to the minerals thereunder, unless 
the person, corporation or partnership against whom drilling or 
mining operations is alleged as a wrongful act is shown to be 
unable to respond in damages for any injury that may result 
from drilling or mining operations; provided, however, that 
the person, corporation or partnership against whom such injunc- 
tion is sought shall enter into a bond with one or more sufficient 
sureties, in such sum as the judge hearing the said application 
and having jurisdiction thereof shall fix, securing the complain- 
ant in the payment of any injuries that may be sustained by 
such complainant as the result of such drilling or mining oper- 
ations; provided, that the court may, when he deems it neces- 
sary to protect any or all interest involved in such litigation, in 
lieu of such bond, appoint a trustee with such powers as the 
court may prescribe or appoint a receiver under the provisions 
of the statute, to take charge of and hold the minerals pro- 



TEXAS 519 

duced from the lands of the complainant or the proceeds thereof 
subject to the final disposition of such litigation. 

Tli is section does not seem to materially modify the practice as 
it existed before the Act except that it denies the writ against a 
solvent party although it forces such solvent party to give a bond 
but allows the writ against a non-solvent party unless he is 
able to furnish a bond. 

Later in the same year was approved the following Act con- 
cerning the Oil and Gas rights of the State in its public lands 
in minute detail which seems to release the State riglits under 
certain conditions where the land had been sold reserving Oil 
lights. July 31, 1919, Special Session, Page 249. 

RELINQUISHING TO THE OWNERS OF THE SOIL FIF- 
TEEN-SIXTEENTHS OF OIL AND GAS UNDER SAME. 

Chapter 81. 

An Act to promote the development of oil and gas resources 
of the State of Texas in Asylum, University and public free 
school lands, constituting the owner of the soil, the agent of the 
State in procuring said development in certain instances and 
in the manner provided herein, and in consideration for said 
services, relinquishing to and vesting in the owner of the soil 
an undivided fifteen-sixteenths of all oil and gas and the value 
of the same that may be within or upon all surveyed public 
free school and asylum land and portions of same which have 
heretofore been sold and which may hereafter be sold with a 
mineral classification or a mineral reservation, and reserving to 
the public free school and asylum funds the remaining undivided 
one-sixteenth and the value of same; authorizing the owner of 
the soil to sell or lease same for the development of the oil and 
gas that may be therein and securing to said funds their portion 
thereof; providing for the drilling of offset wells; providing for 
the forfeiture of oil and gas rights for failure to comply with 
the law and for the reinstatement of forfeited rights; providing 
for a combination of oil and gas permits and for the extension 
of time in which to begin and complete development upon pay- 



f)20 MORRISON S OIL RIGHTS 

ment of sums due under the terms of the permits; providing 
for the assignment of permits and leases; providing for the 
relinquishment of the whole or part of a permit ; providing that 
permits on University land shall come within certain provisions 
of this Act ; providing that payment per acre and obligations to 
pay royalty shall, when paid, be in lieu of damages to the soil; 
providing that rights secured under former law shall not be 
affected except as changed or modified by this Act and declar- 
ing an emergency. 

Be it enacted by the Legislature of the State of Texas: 

Preamble. Rents. Relinquished on Oil and Gas. 

Section 1. To promote the active co-operation of the owner 
of the soil and to facilitate the development of its oil and gas 
resources the State hereby constitutes the owner of the soil, its 
agent for the purposes herein named, and in consideration there- 
for, relinquishes to and vests in the owner of the soil an un- 
divided fifteen-sixteenths of all oil and gas and the value of the 
same that may be upon or within the surveyed free school and 
asylum lands and portions of such surveys that have heretofore 
been sold with a mineral classification and that which may here- 
after be sold with a mineral classification or mineral reservation, 
subject to the terms and conditions of this Act and any future 
law; and the remaining undivided portion of said oil and gas 
and the value of same is hereby reserved for the use and benefit 
of the public free school fund and the several asylum funds. 

Owner May Sell or Lease. 

Sec. 2. The owner of said land is hereby authorized to sell 
or lease to any person, firm or corporation the oil and gas that 
may be thereon or therein upon such terms and conditions as 
such owner may deem best, subject only to the provisions of this 
Aet and the reservations herein, for the benefit of the school and 
asylum funds. All leases and sales so made shall be assignable; 
provided that no oil or gas rights shall be sold or leased here- 
under for less than ten cents per acre per year, plus royalty, 



TEXAS 521 

and the lessee or purchaser shall in every case pay to the State 
ten cents per acre per year of sales and rentals, aiid, in case of 
production, shall pay to the State the undivided one-sixteenth 
of the value of the oil and gas as reserved in Section 1 of this 
Act; — it being expressly provided that all sales or leases of the 
land made by the owner under this Section of the Act shall, as 
respects the rental to be paid, be made for and inure to the 
benefit of the State to the extent herein provided. 

1000 Foot Protection. 

Sec. 3. If oil or gas should be discovered in paying quantities 
on land that is not included in this Act and within one thousand 
feet of land that is so included, the owner, lessee, sub-lessee or 
receiver or other agent in control of such land as is included 
herein, shall in, good faith begin the drilling of an offset well 
tfr wells upon such land as is included herein within one hundred 
days after the first discover, and prosecute same with diligence 
to completion. Every offset well shall be drilled to the depth 
necessary for effective protection against undue drainage by 
other wells on other lands in that locality. 

Forfeiture If Offset Well Not Sunk. 

Sec. 4. If the persons aforesaid, who own or control land 
included in this Act, should fail or refuse to begin such drilling 
of offset wells thereon within the time required or fail or refuse 
to drill such well or wells diligently and in good faith or fail or 
refuse to drill such well or wells to the depth necessary for the 
purpose intended, or fail or refuse to use the means necessary 
to the development of any well or wells thereon within the time 
required or fail or refuse to drill such well drilled thereon, 
thereupon the relinquishment herein granted shall ipso facto 
terminate and the rights acquired thereunder shall likewise 
terminate, and the oil and gas relinquished herein shall revert 
to and become the property of the State's General Revenue Fund 
and when the Commissioner of the* General Land Office is suffi- 
ciently informed of the facts which so terminate such rights, he 
shall indorse on the wrapper containing the papers relating to 



522 MORRISON'S OIL RIGHTS 

the sale of the land words indicating such termination and sign 
it officially. 

Sale after Forfeiture for Bonus and Royalty. •Bidder Must 
Sink. 

Sec. 5. When the relinquishment granted herein and the 
rights acquired thereunder shall have been terminated as pro- 
vided in the preceding section, the Commissioner shall take posses- 
sion of the land and advertise the oil and gas therein for sale. 
All such sales shall be made at such times as the Commissioner 
may determine and in the same manner as is now provided for 
the sale of public free school land. The sale shall be made to 
the person, firm or corporation that will pay the highest price 
therefor in addition to one-eighth of the oil and gas produced or 
the value of same, which shall be reserved to the public free 
school fund. The sum received in addition to the reserved one- 
eighth shall be divided equally between the General Revenue 
Fund of the State and the owner of the soil after deducting the 
expenses incident to the advertisement and sale. Purchasers at 
such sales shall begin the drilling of the necessary offset wells 
within sixty days after the acceptance of their offer and the 
failure -to do so .and the failure to comply with the provisions 
of this Act relating to the drilling of offset wells shall likewise 
operate as a termination of the rights acquired thereunder and 
the substances therein shall be subject to sale as herein provided. 

Double Royalty to State and Owner. 

Sec. 6. One-sixteenth of the value of the gross production of 
oil saved and one-sixteenth of the gross production of gas saved 
and sold off the premises shall be paid to the State and like 
amounts to the owner of the soil on or before the twentieth day 
of each month for the preceding months and it shall be accom- 
panied by a sworn statement of the owner, manager, or other 
authorized agent« showing the gross amount of oil produced and 
saved since the last report and the gross amount of gas produced 
and sold off the premises, and the market value of same, together 
with a copy of all daily gauges of tanks, gas meter readings, if 



TEXAS 523 

any, pipe line receipts, gas line receipts and other checks or 
memoranda of amount produced and put into the pipe lines, 
tanks or pools and gas lines or gas storage. The books and 
accounts, the receipts and discharges of all lines, tanks, pools and 
meters, and all contracts and other records pertaining to pro- 
duction, sale and marketing of oil or gas shall at all times be 
subject to inspection and examination by the Commissioner of the 
General Land Office, the Attorney General, the Governor, or 
the representative of either. # 

Royalties. To What Fund Credited. 

Sec. 7. All sums due the State under the operation of this 
Act shall be due and payable at Austin, Travis County, and shall 
be paid to the Commissioner of the General Land Office and he 
shall transmit all remittances in the form received to the State 
Treasurer, who shall credit the fund to which the land originally 
belonged with the amount paid upon production. 

Liens to State and Owner. 

Sec. 8. The State shall have a first lien upon all oil and gas 
produced upon the land to secure the payment of all sums of 
money that may be due or become due under the provisions of 
this Act; and the owner of the soil shall have a second lien 
thereon to secure the payment of any sum that may be due him. 

Forfeiture for Breach of Lease. 

Sec. 9. If any person, firm or corporation, operating under 
this Act should fail or refuse to make the payment of any sum 
of money due within thirty days after it becomes due, or if such 
one or an authorized agent should knowingly make any false 
return or false report concerning production or drilling, or if 
such one should fail or refuse the proper authority access to the 
records pertaining to the operations, or if such one or an au- 
thorized agent should knowingly fail or refuse to give correct 
information to the proper authority, or knowingly fail or refuse 
to furnish to the General Land Office a correct log of any well, 
the rights acquired under the permit or lease shall be subject to 



524 MORRISON'S OIL RIGHTS 

forfeiture by the Commissioner of the General Land Office, and 
when sufficiently informed of the facts which authorize a for- 
feiture, he shall forfeit same, and the oil and gas shall be subject 
to sale in the manner as provided in Section five of this Act; 
except the owner of the soil shall not thereby forfeit his interest 
in the oil and gas; provided such forfeiture may be set aside 
and all rights theretofore existing shall be reinstated at any 
time before the rights of another intervene upon satisfactory evi- 
dence of future compliance with the provisions of this Act. 

Conflicting Permits. 

Sec. 10. The provisions of this Act relinquishing to the owner 
of the soil fifteen-sixteenths of the oil and gas in or under such 
soil is made subject to the rights now existing under valid per- 
mits to prospect for oil and gas that have heretofore been issued 
or which may hereafter be issued upon valid application now 
on file for such permit; and the rights secured under such 
permits or applications for permits shall be terminated in the 
manner provided by the law under which such rights were 
secured or under the provisions of this Act, but when such rights 
shall be so terminated, such relinquishments shall be fully ef- 
fective; provided a relinquishment to the State of a lease that 
may be producing oil or gas in paying quantities shall not operate 
to relinquish or convey to the owner of the soil any interest 
whatever in the oil and gas that may be in the land included 
in such lease. 

Severance of Mineral and Surface Rights. 

Sec. 11. If one has heretofore or should hereafter acquire 
any valid right to the oil and gas in any unsold public free school 
or asylum land under any other law, a subsequent purchaser of 
such land shall not acquire any rights to any of the oil and gas 
that may be therein, but when such rights shall be terminated in 
the manner provided in the law under which such rights were 
obtained, then the owner of the soil shall become the owner of 
that portion of the oil and gas herein relinquished and shall be 
thereafter subject to the provisions of this Act. A forfeiture of 



TEXAS 525 

the purchase of any survey or tract for any cause shall operate 
as a forfeiture of the minerals therein to the State. 

Assignments and Combinations of Permits. 

Sec. 12. Permits issued, or to be issued upon applications 
heretofore filed, or hereafter filed upon any land included in 
this Act may be assigned as a whole into one ownership or may 
be grouped or combined into one organization, upon such terms 
as the owners may agree, and in one or more groups or com- 
binations not to exceed sixteen sections of 640 acres each, more 
or less, in one group, for the purpose of developing oil and gas. 
All such assignments and agreements shall be recorded in the 
county or counties in which the land or part thereof is situated 
and shall be filed in the General Land Office within sixty days 
after the execution of the same, accompanied by one dollar as 
a filing fee. 

Time to Commence Drilling. 

Sec. 13. The owner of a permit issued upon applications 
heretofore or hereafter tiled shall have eighteen months from 
the date thereof in which to begin the drilling of a well for oil 
and gas on some portion of the land included therein. The 
owner or owners of a combination of permits, held by assign- 
ment or agreement shall have a like period of eighteen months 
from the average date of the permits included therein in which 
to begin the drilling of a well for oil and gas on some portion 
of the land included therein, and the drilling on one permit shall 
be sufficient for the protection against forfeiture of all the per- 
mits included in such combination. Owners of permits included 
herein shall have three years after the date of the permit and 
the same time after the average date of the permits placed in 
a combination of permits in which to complete the development 
of oil and gas thereon, and if oil and gas should not be found 
in paying quantities and a lease applied for within said time, 
all rights in such permit or combination of permits shall ter- 
minate, and the oil and gas in such land shall become subject 
to the provisions of this Act relating to the relinquishment of 
oil and gas to the owner of the soil. 



526 MORRISON'S OIL RIGHTS 

Report of Oil Strike to Be Made with Verified Log. Lease 
Thereupon Issues. 

Sec. 14. If oil or gas should be produced iu paying quantities 
upon any land included in this Act, the owner of the permit 
shall report the development to the Commissioner of the Gen- 
eral Land Office within thirty days thereafter and apply for a 
lease upon such whole surveys or tracts in each permit as the 
owner or owners of a combination of permits may desire to be 
leased and accompany the application with a log of the well or 
wells, and the correctness of the log shall be sworn to by the 
owner, manager or driller, and thereupon a lease shall be issued 
without the payment of any additional sum of money and for 
a period not to exceed ten years, subject to renewal or renewals. 

Rents and Royalties. 

Sec. 15. The owner of a permit or combination of permits 
that desire to avail themselves of the terms of this Act shall pa}' 
to the State ten cents per acre, annually in advance, for the 
.second and third years and shall likewise pay to the owner of the 
soil ten cents per acre for the first year of such permit before 
availing himself of the privileges of this Act, and a like sum 
thereafter annually in advance. A failure to make either of 
said payments shall subject the permit or permits to forfeiture 
by the Commissioner of the General Land Office, and when 
sufficiently informed of the facts which subjects the permit or 
permits to forfeiture the said Commissioner shall forfeit the 
permit or permits by an endorsement of forfeiture upon the 
wrapper containing the papers relating to the permit or permits 
and sign it officially. The payment of the ten cents per acre to 
the owner of the soil may be made in person or by payment to 
the County Clerk of the county in which the land is situated, 
ni id the said clerk shall deposit such payment in some bank at 
the county seat to the credit of the record owner of such land. 
If the owner of the soil should refuse to accept such payment, 
the said clerk shall withdraw such deposit and return same to 
the owner of the permit or permits. The payment, or the tender 
of payment, shall be evidenced by the receipt of the owner ov 



TEXAS 03 / 

part owner or County Clerk filed among the papers in the Gen- 
eral Land Office relating to such permit or permits. 

Surrender of Permit. 

Sec. 16. The owner of a permit or combination of permits 
may relinquish to the State a permit or combination of permits 
or any whole survey or whole tract included in a permit at any 
time before obtaining' a lease therefor by having such relin- 
quishment recorded in the county or counties in which the land 
or a part thereof is situated and file it in the General Land 
Office within sixty days after its execution, accompanied by one 
dollar as a filing fee. 

Permits on University Land. 

Sec. 17. The provisions of this Act, so far as they relate to a 
combination of permits and extensions for time for beginning 
development and time for development, shall apply to permits 
heretofore issued and those hereafter issued upon University 
land. 

Offset Damages to Soil. 

Sec. 18. The payment of the ten cents per acre and the 
obligation to pay the owner of the soil one-sixteenth of the pro- 
duction and the payment of same when produced and the ac- 
ceptance of same by the owner, shall be in lieu of all damages 
to the soil. 

Saving Clause. 

Sec. 19. All the terms, conditions, limitations and obligations 
provided in the law under which permits included herein have 
been or may be issued and rights secured therein shall continue 
and remain in full force and effect except as changed or modi- 
fied by this Act. 

(Approved July 31, 1919.) 

Its provisions then follow as above printed, in language ob- 
scure to a degree, but they seem to be intended to allow to 



528 MORRISON'S OIL RIGHTS 

purchasers who had bought State lands with the minerals re- 
served to the State, to lease or sell such lands or the minerals, 
or both. 

The relinquishment of the fifteen-sixteenths interest is a round- 
about method of reserving a 1/16 royalty to the State^ 

There is nothing in the Act to prevent the owner from selling 
the surface under his original title but if he either sells or leases 
the minerals, he must reserve an acreage rent of 10 cents to the 
State besides a royalty of 1/16. This 1/16 is apparently to 
represent the 1/16 interest reserved to the State and can hardly 
be construed to be an additional 1/16, which would make the 
royalty one eighth. 

The protection area of 1,000 feet mentioned in the third sec- 
tion is beyond all the usual precedents and is a burdensome 
demand on the lessee. 

The interminable title to the Act, in order possibly to comply 
with the Constitutional clause as to conformity between the 
Statute and the name of the Statute, amounts to an index of 
the contents. 

OIL AND GAS CONSERVATION LAW. 

S. B. No. 350.] Chapter 155. 

Acts of Thirty-sixth Legislature, Regular Session. 

An Act to conserve the oil and gas resources of the State of 

Texas. 

Be it enacted by the Legislature of the State of Texas: 

Waste Defined and Prohibited. 

Article 1. Natural gas and crude oil or petroleum shall not be 
produced in the State of Texas in such manner and under such 
condition as to constitute waste. The term "waste" in addition to 
its ordinary meaning shall include (a) escape of natural gas in 
commercial quantities into the open air from a stratum recog- 
nized as a natural gas stratum ; but this is not intended to have 
application to gas pockets in high points in strata recognized as 



TEXAS 529 

oil strata; (b) drowning with water of a gas stratum capable 
of producing gas in commercial quantities; (c) underground 
waste; (d) the permitting of any natural gas well to wasteful] y 
burn; (e) the wasteful utilization of such gas; (f) burning flam- 
beau lights, except when casing head gas is used in same; pro- 
vided, not more than four may be used in or near the derrick of 
a drilling well, and (g) the burning of gas for illuminating pur- 
poses between 8 o'clock a. m. and 5 o'clock p. m., unless the use 
is regulated by meter. 

Waste, Leaks. Protection against Water. 

Article 2. Whenever natural gas in such quantity or quan 
tities, in a gas bearing stratum known to contain natural gas in 
such quantities, is encountered in any well drilled for oil or gas 
in this State, such gas shall be confined to its original stratum 
until such time as the same can be produced and utilized without 
waste and all such strata shall be adequately protected from in- 
filtrating waters. All operators, contractors, or drillers, pipe line 
companies, gas distributing companies drilling for or producing 
crude oil or natural gas or piping oil or gas for any purpose shall 
use every possible precaution in accordance with the most ap- 
proved methods to stop and prevent waste of oil and gas, or both , 
in drilling and producing operations, storage or in piping or 
distributing and shall not wastefully utilize oil or gas, or allow 
same to leak or escape from natural reservoirs, wells, tanks, con- 
tainers or pipes. 

Duties of R. R. Commission. Regulations. 

Article 3. It shall be the duty of the Railroad Commission to 
make and enforce rules and regulations for the conservation of 
oil and gas ; it shall have authority to prevent the waste of oil and 
gas in drilling and producing operations and in the storage, pip- 
ing and distribution thereof, and to make rules and regulations 
for that purpose ; it shall be its duty to require dry or abandoned 
wells to be plugged in such way as to confine oil, gas and water 
in the stratas in which they are found and to prevent them from 
escaping into other stratas, and to establish rules and regulations 
M. 0. R.— 34. 



530 .MORRISON'S OIL RIGHTS 

for that purpose. It is empowered to establish rules and regula- 
tions for the drilling of wells and preserving a record thereof, 
and it shall be its duty to require such wells to be drilled in such 
manner as to prevent injury to the adjoining property, and to 
prevent oil and gas and water from escaping from the stratas 
in which they are found into others stratas, and to establish rules 
and regulations therefor; it shall be its duty to establish rules 
and regulations for shooting wells and for separating oil from 
gas; it shall have authority to require records to be kept and 
reports made by oil and gas drillers, operators and pipe line com- 
panies and by its inspectors; it is authorized to do all things 
necessary for the conservation of oil and gas whether here es- 
pecially enumerated or not, and to establish such other rules 
and regulations as will be necessary to carry into effect this Act 
and to conserve the oil and gas resources of the State. 

Pipe Line Expert. Deputy Supervisors. 

Article 4. It shall be the duty of the pipe line expert provided 
for in section 11, chapter 30, of the Acts of 1917, to be the super- 
visor for the Railroad Commission in enforcing its rules and regu- 
lations. The Railroad Commission may appoint such deputy 
supervisors as may be necessary. It shall have the authority to 
increase the salary of the supervisor to a sum not exceeding $5,~ 
000.00 per annum and to fix the salaries of the deputies at not 
exceeding $3,600.00 per annum, all salaries arid other expenses 
of the administration and enforcement of this Act shall be paid 
out of the funds created in chapter 30 of the Acts of 1917, and in 
the manner therein provided. It shall be the duty of tl*e super- 
visor and his deputies to supervise the plugging of all abandoned 
wells and the shooting of wells and to conform to the rules and 
regulations of the Railroad Commission, dealing with the pro- 
duction and conservation of oil and gas. 

Certificate Required from Pipe Line Company. 

Article 5. Owners or operators of gas wells shall, before con- 
necting with any oil or gas pipe lines, secure from the Railroad 
Commission a certificate showing compliance with the oil and 



TEXAS 531 

gas conservation laws of the State and conservation orders of the 
Kailroad Commission. Pipe line companies shall not connect 
with oil or gas wells until the owners or operators thereof shall 
furnish certificate from the Railroad Commission that the con- 
servation laws of the State have been complied with, provided 
this Act shall not prevent a temporary connection with any well 
or wells in order to take care of production and prevent waste 
until opportunity shall have been given the owner or operator 
of said well to secure certificate showing compliance with the 
conservation laws of the State. 

Books to Be Open to Stockholders. 

Article 6. It is hereby made the duty of all owners or oper- 
ators of oil and gas wells to keep books showing the amount of oil 
and gas produced and disposed of, with the price for which the 
same was sold, together with the receipts from the sale or trans- 
fer of leases or other property and the disbursements made in 
connection with or for the benefit of such business which books 
shall be kept open for inspection of the Railroad Commission or 
any accredited representative thereof; and of any stockholder 
or shareholder in said business and any owner or operator refus- 
ing to comply with the provisions of this article shall be subject to 
the penalties imposed by this Act. 

Double Penalties Imposed. 

Article 7. In addition to any penalty that may be imposed by 
the Railroad Commission for contempt, any firm, person, corpo- 
ration or any officer, agent or employee thereof, directly or indi- 
rectly violating the provisions of this Act or the orders or regu- 
lations of the Railroad Commission made in pursuance thereof, 
shall be subject to a penalty of not more than five thousand ($5,- 
000.00) dollars, to be recovered in any Court of competent juris- 
diction, such suit to be brought in the name of the State of Texas, 
and to be instituted and conducted by any county or district at- 
torney, on the direction of the Railroad Commission. Each day 
that such violation continues shall be considered a separate of- 
fense. 



532 MORRISON'S OIL RIGHTS 

Articles 8, 9, 10, contain the repealing clause, the emergency 
clause and the reservation as to parts of the Act being held un- 
constitutional. Approved March 31, 1919, Reg. Sess. p. 285. 

The last clause of section 7 is an innovation in modern legis- 
lation, attempting to evade the Bill of Rights as to second trials 
after one acquittal or conviction and the inhibition against cruel 
and unusual punishments. If literally enforced it might con- 
fiscate all the assets of the richest companies for trifling noncom- 
pliance with the regulations. 

Senate Substitute Bill No. 36. 
Passed at the Second Called Session, Thirty-sixth Legislature. 
Be it enacted hy the Legislature of the State of Texas: 

Operators to Keep Books and Make Reports to the Commis- 
sion. 

Section 1. It is hereby made the duty of all owners and oper- 
ators of oil and gas wells to keep books, showing accurately the 
amount of stock sold and unsold and amount of promotion money 
paid, amount of oil and gas produced and disposed of, with the 
price for which the same was sold, together with the receipts from 
the sale or transfer of leases or other property, and the disburse- 
ments made in connection with or for the benefit of such business ; 
which books shall be kept open for the inspection of the Railroad 
Commission or any accredited representative thereof, and of any 
stockholder or shareholder or royalty owner in said business, and 
shall report such information to the Railroad Commission of 
Texas for its information, when required by the Commission to 
do so. Any person, firm, partnership, joint stock association, cor- 
poration or other organization, domestic or foreign, operating 
wholly ar partially within this State, acting as principal or agent 
for another for the purpose of drilling, owning or operating any 
oil or gas well, or owning or controlling leases of oil and mineral 
rights, or the transportation of oil or gas by pipe line, shall im- 
mediately file with the Railroad Commission of Texas, at Austin, 
the name of the company or organization, giving the name and 
postoffice address of the organization, the plan under which it 



TEXAS 533 

was organized, and the names and postoffice addresses of the 
trustee or trustees thereof, and the names and postoffice addresses 
of the officers and directors. Any person, firm, joint stock asso- 
ciation, corporation or other organization, or the agent thereof, 
refusing to comply with any of the provisions of this section, 
shall be subject to all the fines and penalties imposed by article 
7, chapter 155, Acts of the regular session of the Thirty-sixth 
Legislature, approved March 31, 1919. 

Sections 2, 3 and 4 direct from what fund the expenses of the 
commission are to be paid : Declare the Act to be cumulative to 
all prior legislation and that an emergency exists. Approved 
July 25, 1919, special session p. 79. 

The above Act, although mostly confined in its terms to wells 
under corporate management, is broad enough to reach opera- 
tions conducted by private individuals. 

OIL AND GAS CIRCULAR NO. 11. 

CONSERVATION RULES AND REGULATIONS. 

Rules 1-35 prescribed July 26, 1919. 

Rule 1. Waste Prohibited. — Natural gas and crude oil or pe- 
troleum shall not be produced in the State of Texas in such man- 
ner and under such conditions as to constitute waste. 

Rule 2. "Waste" Defined. — The term "waste" as above used, in 
addition to its ordinary meaning, shall include: 

(a) Escape of natural gas in commercial quantities into th'; 
open air from a stratum recognized as a natural gas stratum; but 
this is not intended to have application to gas pockets in high 
points in strata recognized as oil strata ; 

(b) Drowning with water of a gas stratum capable of produc- 
ing gas in commercial quantities ; 

(c) Underground waste; 

(d) The permitting of any natural gas to wastefully burn; 

(e) The wasteful utilization of such gas; 

(f) Burning flambeau lights except when casing head gas is 
used in same; provided, not more than four may be used in or 
near the derrick or a drilling well, and 



•~> ; >-i MORRISON'S OIL BIGHTS 

(g) The burning of gas for illuminating purposes between 
eight o'clock a. m. and five o'clock p. m., unless the use is regu- 
lated by meter. 

Rule 3. Gas to Be Confined — Strata to Be Protected. — When- 
ever natural gas in commercial quantities, in a well defined gas- 
bearing stratum known to contain natural gas in such quantities, 
is encountered in any well drilled for oil or gas in this State, 
such gas shall be confined to its origin stratum until such time as 
the same can be produced and utilized without waste, and all 
such strata shall be adequately protected from infiltrating wa- 
ters. This rule shall not apply to the Gulf Coast oil fields of 
Texas; nor shall this rule, as to the fields in which it applies,- 
prevent the drilling deeper in search for oil in any well, if such 
drilling shall be prosecuted with diligence and if said gas be con- 
fined in its stratum and protected as aforesaid upon completion 
of such well; but at any time after the expiration of seven (7) 
days from the penetration of such gas-bearing stratum, even 
though such drilling deeper is being prosecuted with diligence, 
the Railroad Commission, or its Conservation Agent or any de- 
puty of the latter, may require such gas-bearing stratum to be 
cased off and so protected, if in their judgment it shall be rea- 
sonably necessary and proper to do so. 

Rule 4. Approved Methods of Preventing Waste to Be Used. — 
All operators, contractors or drillers, pipe line companies, or gas 
distributing companies, drilling for or producing crude oil or 
natural gas, or piping oil or gas for any purpose, shall use every 
possible precaution in accordance with the most approved meth- 
ods to stop and prevent w T aste of oil and gas, or both, in drilling 
and producing operations, storage, or in piping or distributing, 
and shall not wastefully utilize oil or gas, or allow same to leak 
or escape from natural reservoirs, wells, tanks, containers or' 
pipes. 

Rule 5. "Commercial Quantities" Defined. — Any gas stratum 
showing a well defined gas sand and producing gas shall be con- 
sidered capable of producing gas in commercial quantities, and 
any gas coming from such a stratum or sand shall be considered 
a commercial quantity, and such stratum or sand shall be pro- 
tected the same as under rule 3. 



TEXAS 535 

Rule 6. Gas to Be Taken Ratably. — Whenever the full pro- 
duction from any common source of supply of natural gas in tills 
State is in excess of the market demands, then any person, firm or 
corporation having the right to drill into and produce gas from 
any such common source of supply may take therefrom only 
such proportion of the natural gas that may be marketed without 
waste, as the natural flow of the well or wells owned or controlled 
by any such person, firm or corporation hears to the total natural 
flow of such common source of supply, having due regard to the 
acreage drained by each well, so as to prevent any such person, 
firm or corporation securing any unfair proportion of the gas 
therefrom; provided, that the Railroad Commission of Texas 
may, by proper order, permit the taking of a greater amount 
whenever it shall deem such taking reasonable or equitable. 

Rule 7. Commission Will Regulate the Taking of Natural Gas. 
— The Railroad Commission of Texas will, as occasion arises, pre- 
scribe rules and regulations for the determination of the natural 
flow of any well or wells in this State, and will regulate the tak- 
ing of natural gas from any and all common sources of supply 
within the State so as to prevent waste, protect the interests of 
the public and of all those having a right to produce therefrom; 
and to prevent unreasonable discrimination in favor of one com- 
mon source of supply as against another. 

Rule 8. Gas to Be Metered. — All gas produced from the de- 
posits of this State when sold shall be measured by meter, and 
each gas well, or the entire property on which it is located, shall 
be equipped with such meter. 

Rule 9. Notice of Intention to Drill, Deepen or Ping. — Notice 
shall be given to the Railroad Commission of Texas or its agents 
of the intention to drill, deepen or plug any well or wells and of 
the exact location of each and every such well. In case of dril- 
ling, notice shall be given at least five (5) days prior to the com- 
mencement of drilling operations. 

Notice of intention to plug must be given at least twenty-four 
(24) hours prior to beginning of plugging, and must be accom- 
panied by a complete log of the well, on forms prescribed by the 
Railroad Commission of Texas. 

Blanks for notification and reports can be obtained by appliea- 



536 MORRISON'S OIL RIGHTS 

tion to the Railroad Commission of Texas or its conservation 
agent in the field. 

Rule 10. Plugging Dry and Abandoned Wells. — (a) All 
abandoned or dry wells shall immediately be plugged according 
to the following rules : 

(b) Manner of Plugging. — All dry or abandoned wells must 
be plugged by confining all oil, gas or water in the strata in 
which they occur, by the use of mud-laden fluid, or by some 
other method approved by the Commission. In case of cable- 
drilling, cement and plugs may be used. 

(c) Notice of Intention to Plug. — Before plugging dry and 
abandoned wells, notice shall be given to the Railroad Commis- 
sion of Texas or its conservation agent in the field, and to all 
available adjoining lease and property owners, and representa- 
tives of such lease and property owners may, in addition to the 
oil and gas conservation agent of the commission, be present to 
witness the plugging of these wells if they so desire, but plugging 
shall not be delayed because of failure or inability to deliver no- 
tices to adjoining lease or property owners. 

Rule 11. Log and Plugging Record to Be filed with Commis- 
sion. — The owner or operator shall, upon the completion of any 
well, file with the Railroad Commission of Texas a complete rec- 
ord or log of the same, duly signed and sworn to, upon blanks 
to be furnished by the commission upon application; and upon 
plugging any well for any cause whatsoever, a complete record 
of the plugging thereof shall be made out and duly verified on 
blanks to be furnished by the Commission. 

Rule 12. Proper Anchorage to Be Laid. — Before any well is 
begun in any field where it is not known that high pressure does 
not exist, proper anchorage shall be laid so that the control cas- 
ing-head may be used on the inner string of casing at all times, 
and this type of casing-head shall be kept in constant use unless 
it is known from previous experience and operations on wells ad- 
jacent to the one being drilled that high pressure does not exist 
or will not be encountered therein. 

Rule 13. Equipment for Conserving Natural Gas Shall Be 
Provided Before "Drilling- in." — In all proven or well- defined 
gas fields, or where it can reasonably be expected that gas in com- 



TEXAS 537 

uiereial quantities will be encountered, adequate preparations 
shall be made for the conservation of gas before "drilling-in" 
any well. 

Rule 14. Separate Slush Pit to Be Provided. — Before com- 
mencing to drill a well, a separate slush pit or sump hole shall 
be constructed by the owner, operator or contractor for the recep- 
tion of all pumpings from clay or soft shale formations in order 
to have the same on hand for the making of mud-laden fluid. 

Note. — In order to avoid freezing casings, operators are cau- 
tioned not to allow sand or lime to be mixed with clay or soft 
shale pumpings. 

Rule 15. Wells Not to Be Permitted to Produce Oil and Gas 
from Different Strata.—No wells shall be permitted to produce 
both oil and gas from different strata unless it be in such manner 
as to prevent waste of any character to either product and in 
accordance with rule 3. 

Rule 16. Strata to Be Sealed Off.— No well shall be drilled 
through or below any oil, gas or water stratum without sealing 
off such stratum or the contents thereof, after passing through 
the sand, either by the mud-laden fluid process or by casing and 
packers, regardless of volume or thickness of sand ; provided this 
rule shall be subject to rule 3 as that rule relates to natural gas. 

Rule 17. Density of Mud-Fluid Where Well Containing Water 
is Drilled Into Oil or Gas-Producing Strata. — No operator shall 
drill a well into a known oil or gas-producing sand with water 
from a higher formation in the hole, or with a sufficient head of 
water introduced into the hole to prevent gas blowing to the sur- 
face* The well shall either be allowed to blow until the same has 
been drilled-in or it shall be drilled in under a head of fluid 
consisting, when necessary, of not less than 25 per cent mud; but 
in no case shall" gas be allowed to blow for a longer period than 
three (3) days after completion of well. Mud-laden fluid used 
for protecting oil and gas-bearing sands in upper formations 
while oil or gas is being produced from deeper formations should 
have a density of not less than 25 per cent mud and should con- 
tain not less than 28 per cent mud. 

Rule 18. Mi'd-Jadcn Fluid to Be Applied in Pulling or Re- 
deeming Casing. — No outside casing from any oil or gas well in 



538 MORRISONS OIL RIGHTS 

an unexhausted oil or gas field, shall be pulled without first flood- 
ing the well with mud-laden fluid behind the inside string of 
easing, after unseating the easing, and as easing is withdrawn 
well shall be kept full to top with said mud-laden fluid and same 
shall be left in the hole; and said mud-laden fluid shall be so 
applied as to effectively seal off all fresh or salt water strata, and 
all oil or gas strata not being utilized. 

Rule 19. Mud-laden Fluid — When to Be Applied to Com- 
pleted Wells. — When necessary (or in any event when ordered 
by the Railroad Commission of Texas) to seal off any oil, gas 
or water sand, casing shall be seated in mud-laden fluid; and 
concerning wells already drilled, the operator shall, upon the 
order of the Railroad Commission of Texas, raise any string or 
strings of casings and reseat them in mud-laden fluid when it is 
1 bought advisable to do so in order to avoid existing underground 
waste, pollution or infiltration. 

Rule 20. Fresh Water to Be Protected. — Fresh water, whether 
above or below the surface, shall be protected from pollution, 
whether in drilling or plugging. 

Rule 21. Separating Devices. — Where oil and gas are found 
in the same stratum and it is impossible to separate the one from 
the other, the operator shall, upon being so ordered by the Rail 
road Commission of Texas, install a separating device of ap- 
proved type, which shall be kept in place and used as long as 
necessity therefor exists, and after being installed, such device 
shall not be removed, nor the use thereof discontinued, without 
the consent of the Railroad Commission of Texas. 

Rule 22. Gas Wells Not to Produce from Different Sands at 
the Same Time Through the Same String of Casing. — No gas well 
shall be permitted to produce gas from different levels, sands or 
strata at the same time through the same string of casing, and 
when gas upon being found is not needed for immediate use, the 
same shall be confined in its original stratum until such time as 
the same can be produced and utilized without waste, and in 
confining gas to its original place the mud-laden fluid process 
shall be used unless the character of the formation involved is 
sufficiently ascertained and understood to know that the casing 
and packer method with Braden-head attachment can be safely 



TEXAS 539 

applied and competently used, and in the use of the casing, pack- 
ing and Braden-head method, separate strings of casing shall be 
run to each sand. 

Rule 23: Shooting of Wells. — (a) All shooting of wells shall 
be under rules and regulations of the Railroad Commission of 
Texas. 

(b) Wells Not to Be Shot Into Salt Water.— No well shall be so 
shot as to let in salt water or other foreign substance injurious 
to the- oil or gas sand. 

(c) Reports to Be Made to the Bail road Commission of Texas. 
— Reports shall be made to the Railroad Commission of Texas 
on all wells shot, showing the condition of the well before and 
after shooting, including the size of the shot, sand or sands shot, 
production before and after shooting, per cent of water in well 
before and after shooting. 

(d) Damaged, Wells to Be Abandoned. — In case irreparable 
injury is done to the wells, or to the oil or gas sand or sands by 
shooting, the well shall immediately be abandoned and plugged as 
provided by rule No. 10. 

(e) Notice of Intention to Shoot. — Notice of intention to shoot 
must be given the Railroad Commission of Texas, on blank form 
prescribe by it, at least two (2) days prior to shooting. 

Rule 24. Gauge to Be Taken — Reports to Commission. — All 
oil and gas operators shall, between the first, and tenth of each 
month, take the rock pressure of all wells producing natural gas 
which is being marketed, and shall forthwith report to the Rail- 
road Commission of Texas, on gauge blanks furnished by the 
Commission. 

Rule 25. Production of Gas to Be Restrained to Fifty Per 
Cent of Potential Capacity. — When the gas from any well is 
being used, the flow or production thereof shall be restrained to 
fifty (50) per cent of the potential capacity of the same; that is 
to say, in any day (24 hours) the well shall not be permitted to 
flow or produce more than one-half of the potential capacity 
thereof as shown by the last monthly gauge ; provided, that this 
rule shall not apply to casing-head gas, and provided further 
that, in cases of emergency, greater production may be used after 



f>40 MORRISON'S OIL RIGHTS 

special authority therefor has been secured from the Railroad 
Commission of Texas. 

Rule 26. Notification of Fires and Breaks or Leaks. — All dril- 
lers, operators, pipe line companies, and individuals operating 
oil and gas wells or pipe lines shall immediately notify the Rail- 
road Commission of Texas by letter of all fires which occur at 
oil or gas wells or oil tanks owned, operated, or controlled by 
them or on their property, and shall immediately report all tanks 
struck by lightning and any other fires which destroy crude oil 
or natural gas, and shall immediately report, in the manner here- 
tofore described, any breaks or leaks in tanks or pipe lines from 
which oil or gas is escaping. In all reports of fires, breaks, or 
leaks in pipes, or other accidents of this nature, the location of 
the well, tank or line break shall be given, showing location by 
county and survey. The reports provided for under this rule 
shall only be required when the loss by fire, breaks or leaks or 
other accident is material and only as regards losses connected 
with production or transportation in this State over which the 
Railroad Commission of Texas has jurisdiction. 

Rule 27. Reports from Pipe Line Companies. — The Railroad 
Commission of Texas will, from time to time, require oil and gas 
pipe line companies to make reports to the Commission showing 
wells connected with their lines during any month, the amount 
of production taken therefrom, names of parties from whom oil 
and gas are purchased, the amount of oil or gas purchased there- 
from; and all oil and gas pipe line companies shall, in addition 
to the other reports required by the rules of the Commission, 
furnish to the Commission duplicates of all reports made to the 
State Comptroller under the oil and gas gross production tax 
laws. The Commission will, in case of over-production or for any 
other reason which it deems urgent, require oil or gas pipe line 
companies to furnish daily reports of the amount of oil or gas 
purchased or taken from different wells or parties. 

Rule 28. Pipe Line Companies — Connection with Oil or Has 
Wells. — Pipe line companies shall not connect with oil or gas 
wells until the owners or operators thereof shall furnish a certi- 
ficate from the Railroad Commission of Texas that the conserva- 
tion laws of the State have been complied with ; provided, this 



TEXAS 541 

rule shall not prevent the temporary connection with any well 
or wells in order to take care of production and .prevent waste 
until opportunity shall have been given the owner or operator 
of said well to secure certificate showing compliance with the 
conservation laws of the State. 

Rule 29. Certificates — Showing Compliance with Conserva- 
tion Laws and Rides Prior to Connection. — Owners or operators 
of oil or gas wells shall, before connecting with any oil or gas pipe 
line, secure from the Railroad Commission of Texas a certificate 
showing compliance with the oil and gas conservation laws of the 
State and conservation orders of the Commission ; provided that 
this rule shall not prevent temporary connection with pipe lines 
in order to take care of production until opportunity shall have 
been given for securing such certificate ; provided, further, that 
the owners or operators of such wells shall, in a known or proven 
field, make application for such certificate in anticipation of 
production. 

Rule 30. Drilling Records to Be Kept. — All operators, con- 
tractors, or drillers shall keep at each well, while drilling same, 
accurate records of the drilling, redrilling, or deepening of all 
such wells, showing all formations drilled through, casing used, 
and other information in connection with drilling and operation 
of the property, and any and all of this information shall be 
furnished to the Railroad Commission of Texas upon request, or 
to any conservation agent of the Commission. 

Rule 31. Conservation Agents to Have Access to All Wells and 
All Well Records. — Conservation agents of the Railroad Commis- 
sion of Texas shall have access to all wells and to all well records, 
and all companies, contractors, or drillers, shall permit any con- 
servation agent of the Commission to come upon any lease or 
property operated or controlled by them and to inspect any and 
all wells and the records of said well or wells, and to have access 
at all times to any and all wells and any and all records of said 
wells. Provided, that information so obtained by conservation 
agents shall be considered official and confidential information 
and shall be reported only to the Commission. 

Rule 32. Books to Be Kept — Reports to Be Made. — All owners 
and operators of oil and gas wells in this State shall keep books 



542 MORRISON'S OIL RIGHTS 

showing accurately the amount of stock sold and unsold and 
amount of promotion money paid, amount of oil and gas pro- 
duced and disposed of, with the price for which the same was 
sold, together with the receipts from the sale or transfer of leases 
or other property, and the disbursements made in connection 
with or for the benefit of such business; which books shall be 
kept open for the inspection of the Railroad Commission of Texas 
or any accredited representative thereof, and of any stockholder 
or shareholder or royalty owner in said business, and shall re- 
port such information to the Railroad Commission of Texas for 
its information, when required by the Commission to do so. Any 
person, firm, partnership, joint stock association, corporation or 
other organization, domestic or foreign, operating wholly or par- 
tially within this State, acting as principal or agent for another, 
for the purpose of drilling, owning or operating any oil or gas 
well, or owning or controlling leases of oil and mineral rights, 
or the transportation of oil or gas by pipe line, shall immedi- 
ately file with the Railroad Commission of Texas, at Austin, 
the name of the company or organization, giving the name 
and postoffice address of the organization, the plan under which 
it was organized, and the names and postoffice addresses of the 
trustee or trustees thereof, and the names and postofiice addres- 
ses of the officers and directors. 

Rule 33. Notice to Contractors, Drillers and Others to Observe 
Rules. — All contractors and drillers carrying on business or do- 
ing work in the oil or gas fields of the State, as well as lease- 
holders, land owners and operators generally, shall take notice 
of and are hereby directed to observe and apply the foregoing 
rules and regulations; and all contractors, drillers, land owners 
and operators will be held responsible for infractions of said 
rules and regulations. 

Rule 34. Conservation Agents — Co-operation with Federal 
Inspectors. — All conservation agents appointed by the Railroad 
Commission of Texas shall co-operate with and invite the co-op- 
eration of the oil and gas inspectors of the United States Bureau 
of Mines of the Department of the Interior. 

Rule 35. Conservation Agents — To Enforce These Rules. — 
All conservation agents appointed by the Railroad Commission 



TEXAS 54o 

of Texas shall be governed by, and are charged with the enforce- 
ment of, the law and these rules and regulations. 

This order take effect and be in force on and after July 26, 
1919, until amended or canceled by this Commission. 

Allison Mayfield, Chairman; 
Earle B. Mayfield, 
Clarence E. Gilmore, 

Commissioners. 
E. R. McLean, Secretary. 

SUPPLEMENT TO OIL AND GAS CIRCULAR NO. ll v 

Adopted November 26, 1919. 

Rule 36. No pipe line, whether a common carrier or not, shall 
be used to transport oil or gas from any tract of land within this 
State, except to another tract immediately adjoining, without a 
permit from the Railroad Commission of Texas. Application 
for such permit shall be made upon the form prescribed by the 
Railroad Commission of Texas, and such permit will be granted 
when the Railroad Commission of Texas is satisfied, from such 
application and the evidence in support thereof, and its own 
investigation, that the proposed line is, or will be, so laid, 
equipped, and managed as to reduce to a minimum the possibility 
of waste. *" 

Such permit, if granted, shall be valid for only one year, and 
shall be revocable at any time after hearing had on ten days 
notice, if, in the judgment of the Railroad Commission, any line 
is so unsafe or so improperly equipped or managed as to be 
iikely to cause waste; or, if in the judgment of the Railroad 
Commission, the owner or operator of such line, in the operation 
thereof, is violating the Acts of the Thirty-sixth Legislature, 
chapter 155, being an Act to conserve the oil and gas resources 
of the State of Texas, or any rule or regulation of the Railroad 
Commission, enacted under or in pursuance of said Act. 

This rule shall take effect immediately as to any pipe lines not 
now constructed, or under construction ; and shall take effect 
fifteen days from date of this order as to any pipe lines now con- 



544 MORRISON'S OIL RIGHTS 

structed or operated; and thirty days from date of this order 
as to any pipe lines now under construction. 

Rule 37. No well for oil or gas shall hereafter be commenced 
nearer than three hundred (300) feet to any other completed or 
drilling well on the same or adjoining tract or farm ; and no well 
shall be drilled nearer than one hundred and fifty (150) feet to 
any property line ; provided, that the Commission, upon petition 
filed, showing good cause, and provided that no injustice will be 
done, may, after hearing had, upon notice to adjoining tract 
owners or lessees, allow drilling within shorter distances than as 
above described. Rule 37 shall not for the present be enforced 
within the developed and defined oil fields known as the Gulf 
Coast Fields. 

Rule 38. All maps or sketches of any kind of any separate 
lease or tract of land, filed with the Oil and Gas Department of 
the Railroad Commission, must be drawn on a scale of four 
hundred (400) feet to one inch, unless the area involved is less 
than two acres, when the scale must be forty (40) feet to one 
inch, or unless the Commission specially grants permission that 
maps furnished may be drawn on another scale. 

Rule 39. (1) All permanent oil tanks or battery of tanks must 
be surrounded by a dike or ditch of at least the capacity of the 
tank or battery of tanks. 

(2) No flow tank, unless it is entirely buried, or other oil tank 
of any size, shall hereafter be placed nearer than 150 feet to any 
derrick, rig, building, power plant or boiler of any description, 
except where topography does not permit. 

(3) No fiel$ working tank having a capacity of 5,000 barrels 
or more shall hereafter be built nearer than 200 feet (measured 
from shell to shell) to any other like tank or tanks. 

(4) No battery of field storage tanks shall hereafter be placed 
nearer than 20 fee* to any other battery. 

(5) Printed signs reading "Dangerous, No smoking Allowed," 
or similar words, shall be posted in conspicuous places on each 
producing lease or farm. 

(6) All lessees' premises shall be kept clear of high grass, 
weeds and combustible trash, within a radius of 100 feet around 
an oil tank, tanks or producing wells. 



TEXAS 545 

(7) Open earthen storage for merchantable oil is hereafter 
prohibited, except when the Commission grants special permis- 
sion in order to meet an unforseen emergency. Where such 
storage is now in use, it must be discontinued within a reasonable 
time. 

(8) Swabbing into open pits is prohibited except when testing 
a well or cleaning out and such swabbing shall not continue for 
a longer period than ten days, without permission from the Rail- 
road Commission. _ 

(9) All oil tanks, where there is a gas hazard, shall be well 
covered and provided with adequate gas vents. 

(10) No forge or open light shall be placed inside the derrick 
of a well showing oil 6r gas. 

(11) Boilers must be equipped with steam lines for fighting 
fire and must not be set nearer than 100 feet to any producing 
well. 

(12) All oil and gas pipe lines laid upon or across a public 
road or highway must be buried to a reasonably safe depth. 

(13) Wherever available and practicable, electric light and 
power shall be installed in congested drilling areas, upon order 
of the Commission. 

Rule 40. Vacuum Pumps Prohibited. — The use of vacuum 
pumps or other devices for the purpose of extracting oil or gas, 
except casing-head gas where the same is utilized, from any well 
by the vacuum process, is prohibited, except in depleted or prac- 
tically depleted fields. 

Rules 39 and 40 effective May 1, 1920. 

REGULATING PIPE LINES. 
S. B. No. 68.] Chapter 30. 

Acts of the Thirty-fifth Legislature, Regular Session. 
Be it enacted by the Legislature of the State of Texas: 

Pipe Line Companies Are Common Carriers Except When Lim- 
ited to Their Own Product. 

Section 1. Every person, firm, corporation, limited partner^ 
ship, joint stock association or association of any kind whatever; 
M. O. R.— 35. 



546 MORRISON'S OIL RIGHTS 

(a) Owning, operating or managing any pipe line or any part 
of any pipe line within the State of Texas for the transportation 
of crude petroleum to or for the public for hire, or engaged in the 
business of transporting crude petroleum by pipe line ; or 

(b) Owning, operating or managing any pipe line or any part 
of any pipe line for the transportation of crude petroleum to or 
for the public for hire, and which said pipe line is constructed 
or maintained upon, along, over or under any public road or 
highway, or in favor of whom the right of eminent domain exists ; 
or 

(c) Owning, operating or managing any pipe line or any part 
of any pipe line or pipe lines for transportation to or for the 
public, for hire, of crude petroleum, and which said pipe line or 
pipe lines is or may be constructed, operated or maintained 
across, upon, along, over or under the right of way of any rail- 
road corporation or other common carrier required by law to 
transport crude petroleum as a common carrier; or 

(d) Owning, operating or managing or participating in own- 
ership, operation or management, under lease, contract of pur- 
chase, agreement to buy or sell, or other agreement or arrange- 
ment of any kind whatsoever, any pipe line or pipe lines, or 
part of any pipe line, for the transportation from any oil field or 
place of production within the State of Texas to any distributing, 
refining or marketing center or reshipping point thereof, within 
this State, of crude petroleum bought of others ; 

Is hereby declared to be a common carrier and subject to the 
provisions hereof. But the provisions of this Act shall not apply 
to those pipe lines which are limited in their use to the wells, 
stations, plants and refineries of the owner and which are not a 
part of the pipe line transportation system of any common car- 
rier as above defined; nor shall such provisions apply to any 
property of such a common carrier which is not a part of or 
necessarily incident to its pipe line transportation system. 

Involved Language Apparently Limiting Section 1. 

Sec. 2. It is declared that the operation of those pipe lines, to 
which this Act applies, for the transportation of crude petroleum, 
in connection with the purchase or purchase and sale of such 



TEXAS 547 

crude petroleum, is a business in the mode of the conduct of 
which the public is interested, and as such is subject to regula- 
tion by law; and accordingly it is provided that from and after 
the expiration of thirty (30) days from the time this law takes 
effect the business of purchasing, or of purchasing and selling 
crude petroleum, using in connection with such business a pipe 
line of the class subject to this Act, to transport the crude petro- 
leum so bought or sold shall not be conducted, unless such pipe 
line so used in connection with such business be a common car- 
rier within the purview of this law and subject to the jurisdic- 
tion herein conferred upon the Railroad Commission of Texas. 
it shall be the duty of the Attorney General to enforce this pro- 
vision by injunction or other adequate remedy. 

Right of Way. 

Sec. 3. The right to lay, maintain and operate pipe lines, 
together with telegraph and telephone lines incidental to and 
designated for use only in connection with the operation of such 
pipe lilies along, across or under any public stream or highway 
in this State, is hereby conferred upon all persons, firms, limited 
partnerships, joint stock associations, or corporations coming 
within any of the definitions of common carrier pipe lines as here- 
inbefore made. Any person, firm, limited partnership, joint stock 
association, or corporation may acquire the right to construct 
pipe lines and such incidental telephone and telegraph lines 
along", across or over any public road or highway in this State, 
by filing with the Railroad Commission an acceptance of the 
provisions of this law, expressly agreeing in writing that in con- 
sideration of the rights so acquired it shall be and become a 
common carrier pipe line, subject to the duties and obligations 
conferred or imposed in this Act. This right to run along, across 
or over any public road or highway, as before provided for can 
only be exercised upon condition that the traffic thereon be not 
interfered with, and that such road or highway be promptly 
restored to its former condition of usefulness, and the restoration 
thereof to be subject also to the supervision of the county com- 
missioners Court or other proper local authority. And provid- 
ed, that in the exercise of the privileges herein conferred such 



548 MORRISON'S OIL RIGHTS 

pipe lines shall compensate the county or road districts, respec- 
tively, for any damage done to such public road, in the laying 
of pipe lines, telegraph or telephone lines, along or across the 
same; and nothing herein shall be construed to grant any pipe 
line company the right to use any public street or alley of any 
incorporated city or town, except by express permission from the 
city or governing authority thereof ; and nothing herein shall be 
construed to permit any company to use any street or alley of an 
unincorporated town, except by express permission of the com- 
missioners Court of the county in which such town is situated. 

[Regulations. Rates. Hearings. Complaints. 

Sec. 4. The Railroad Commission shall have the power to es- 
tablish and enforce rates of charges and regulations for gather- 
ing, transporting, loading, and delivering crude petroleum by 
such common carriers in this State, and for the use of storage 
facilities necessarily incident to such transportation, and to pre- 
scribe and enforce rules and regulations for the government and 
control of such common carriers in respect to their pipe lines and 
receiving, transferring and loading facilities, and it shall be its 
duty to exercise such power upon petition by any person showing 
a substantial interest in the subject. No order establishing or 
prescribing rates, rules and regulations shall be made except 
after hearing and at least ten days and not more than thirty days 
notice to the person, firm, corporation, partnership, joint stock 
association, or association owning or controlling and operating 
the pipe line or pipe lines affected. In the event any rate shall 
be filed by any pipe line and complaint against same or petition 
to reduce same shall be filed by any shipper, and such complaint 
be sustained, in whole or in part, all shippers who shall have 
paid the rates so filed by the pipe line shall have the right to re- 
paration or reimbursement of all excess in transportation charges 
so paid over and above the proper rate as finally determined on 
all shipments made after the date of the filing of such complaint. 

Exchange of Tonnage. Commission's Orders Prima Facie 
Valid. 

Sec. 5. Every common carrier as above defined shall exchange 



TEXAS 549 

crude petroleum tonnage with each like common carrier and the 
Commission shall have the power to require such connections and 
facilities for the interchange of such tonnage to be made at every 
locality reached by both pipe lines whenever a necessity therefor 
exists and subject to such rates and regulations as may be made 
by the Commission; and any such common carrier under like 
rules and regulations shall be required to install and maintain 
facilities for the receipt and delivery of crude petroleum of pa- 
trons at all points on such pipe line. No carrier shall be required 
to receive or transport any crude petroleum except such as may 
be marketable under rules and regulations to be prescribed by 
the Commission, which they are hereby empowered and required 
to prescribe. The Commission is also empowered and required 
to make rules for the ascertainment of the amount of water and 
other foreign matter in oil tendered for transportation, and for 
deduction therefor and for the amount of deduction to be made 
for temperature, leakage and evaporation. It is provided, how- 
ever, that the recital herein of particular powers on the part of 
said Commission shall not be construed to limit the general pow- 
ers conferred by this Act. Until set aside or vacated by some 
decree or order of a Court of competent jurisdiction, all orders 
of the Commission as to any matter within its jurisdiction shall 
be accepted as prima facie evidence of their validity. 

Tariffs, Monthly Reports. Power to Hear Complaints. 

Sec. 6. Such common carriers of crude petroleum shall make 
and publish their tariffs under such rules and regulations as may 
be prescribed by said Commission, and the Commission shall re- 
quire them to make reports and may investigate their books and 
records kept in connection with such business. The Commission 
shall require of such common carrier pipe lines monthly reports, 
duly verified under oath, of the total quantities of crude petro 
jeum owned by such pipe lines and of that held by them in 
storage for others, as also of their unfilled storage capacity, pro- 
vided no publicity shall be given by the Commission to the re- 
ports as to stock of crude petroleum on hand of any particular 
pipe line ; but the Commission in its discretion may make public 
the aggregate amounts held by all the pipe lines making such 



550 MORRISON'S OIL RIGHTS 

reports, and of their aggregate storage capacity. The Commis- 
sion shall have the power and authority to hear and determine 
complaints, to require attendance of witnesses, pay their expenses 
out of the fund herein created, and to institute suits and sue out 
such writs and process as may be necessary for the enforcement 
of its orders. 

Discrimination Forbidden. 3000 Barrel Limit. 

Sec. 7. No such common carrier in its operations as such shall 
discriminate between or against shippers in regard to facilities 
furnished or service rendered or rates charged under same or 
similar circumstances in the transportation of crude petroleum; 
nor shall there be any discrimination in the transportation of 
crude petroleum produced or purchased by itself, directly or 
indirectly. In this connection the pipe line shall be considered 
as a shipper of the crude petroleum produced or purchased by 
itself, directly or indirectly, and handled through its facilities. 
No such carrier in such operations shall directly or indirectly 
charge, demand, collect or receive from anyone a greater or less 
compensation for any service rendered than from another for 
a like and contemporaneous service; provided, this shall not 
limit the right of the Commission to prescribe rates and regula- 
tions different from or to some places from other rates or regula- 
tions for transportation from or to other places, as it may de- 
termine ; nor shall any carrier be guilty of discrimination when 
obeying any order of the Commission. When there shall be 
offered for transportation more crude petroleum than can be 
immediately transported the same shall be equitably apportioned. 
The Commission may make and enforce general or specific regu- 
lations in this regard. No such common carrier shall at any time 
be required to receive for shipment from any person, firm, cor- 
poration or association of persons, exceeding three thousand 
barrels of petroleum in any one day. 

Waste. 

Sec. 8. The Commission, when necessary, shall make and en- 
force rules and regulations either general in their nature or 



TEXAS 551 

applicable to particular oil fields for the prevention of actual 
waste of oil or operations in the field dangerous to life or prop- 
erty. 

Penalties. 

Sec. 9. Any common carrier as herein defined who shall vio- 
late any provision of this Act or who shall fail to perform any 
duty herein imposed or any valid order of the Commission when 
not stayed or suspended by order of court, shall be subject to a 
penalty of not less than one hundred dollars nor more than one 
thousand dollars for each offense, such penalty to be recoverable 
at suit of the Attorney General of the State of Texas in the name 
of the State and for its use. Such penalty may also be recovered 
by and for the use of any person, corporation or association of 
persons against whom there shall have been an unlawful dis- 
crimination as herein defined; such suit to be brought in the 
name of and for the use of party "aggrieved and may be main- 
tained in any court of proper jurisdiction, having due regard 
to the ordinary statutes cf venue. For the wilful violations of 
the provisions herein forbidding discrimination on the part of 
common carriers it is hereby provided that the owners, officers, 
agents or employees of such carriers who may be guilty thereof 
shall be deemed guilty of a misdemeanor, each violation of such 
provision shall be deemed a separate offense and upon convic- 
tion thereof the party violating same shall be fined in a sum of 
not less than fifty dollars nor more than one thousand dollars 
and may be further punished by confinement in the county jail 
for not less than ten days, nor more than six months. 

Discrimination. 

Sec. 10. Subject to the provisions of this Act and the rules 
and regulations which may be prescribed by the Commission, 
every such common carrier shall receive and transport crude 
petroleum delivered to it for transportation and shall so receive 
and transport same and perform its other duties with respect 
thereto wkhout discrimination. 



552 MORRISON'S OIL RIGHTS 

Expert and Other Assistants. Special Tax. 

Sec. 11. It shall be the duty of the Commission to employ an 
expert, who shall gather information and assist the Commission 
in the performance of its duties under this Act. The salary of 
this expert shall be at the rate of thirty-six hundred dollars per 
annum, payable in equal monthly installments. And the Com- 
mission shall employ such other assistants as may be necessary. 
These salaries and expenses and the expenses of the hearings and 
investigations conducted by said Commission shall be paid out of 
a fund to be derived from a tax of one-twentieth of one per 
cent of the market value of crude petroleum produced within 
this State, which tax is hereby levied, and which tax shall be in 
addition to and collected in the same manner as the present gross 
receipts production tax on crude petroleum. Producers of crude 
petroleum are hereby required to make reports of production in 
the same manner and under the same penalties as for the gross 
production tax. The tax thus collected shall be paid into the 
State Treasury as other revenue, and shall be paid out in war- 
rants as other State funds. Any yearly excess of the tax over 
and above the requirements of the Commission shall become a 
part of the general revenue of the State and any deficit shall be 
made up out of the general revenue of the State. 

Section 12 makes a $5000 appropriation. Sections 13-15 pro- 
vide for payment of salaries and expenses, declare the Act to 
be cumulative and anticipate the holding that parts of the Act 
may be held unconstitutional. The circular contains regulations 
under the Act and the rates of transportation. Regular Sess. 
1917 p. ....... 



CHAPTER 83. 

STATE STATUTES. 

None of the States apparently have what can be called a 
code of oil and gas law. The nearest approach to it is Cali- 
fornia where a special department of petroleum and gas has 
been created. Several of the States have Acts compelling the 
plugging of wells, prohibiting waste of gas, requiring public 
record of logs and concerning transportation of gas in pipe 
lines. Some have special statutes as to the recording of oil 
leases and their surrender or forfeiture. Such statutes we have 
endeavored to collect under the name of the State. Almost 
every State has an inspection law for power and burning oils. 
Inspection of oil and mechanics liens are not within the scope 
of this book. The Blue Sky Laws are digested under chapter 
85 on page 811. 

ALASKA. 

License Tax Imposed on Miners. 

Section 1. That any person, firm or corporation prosecuting 
or attempting to prosecute, any of the following lines of busi- 
ness in the Territory of Alaska shall apply for and obtain a 
license, and pay for said license, for the respective lines of 
business, as follows : Act of May 1, 1919, Laws p. 90, 

Income Denned. Deductions. 

12th: Mining: One per cent of the net income in excess of 
live thousand dollars, By "net" income is meant the cash value 
of the output of the mine less operating expenses, repairs and 
betterments actually made, and royalties actually paid, and 

553 



554 MORRISON'S OIL RIGHTS 

all taxes paid under section 2569 of the Compiled Laws of 
Alaska. 

Provided, that the lessor of any mine operated under a lease 
shall be deemed to be engaged in mining within the provisions 
of this Act and the royalties, less the cost of collecting the same, 
received by him, shall be deemed to be the net income within 
the provisions of this Act. 

No deduction shall be made on account of depreciation of 
machinery, interest on bonds or money borrowed, or other taxes 
paid. By "mining" is meant any operation by which valuable 
metals, ores, minerals or marketable stone is extracted from the 
earth. Id. 

CALIFORNIA. 

The California Act was passed in 1915, amended in 1917 and 
1919. The following is the text as it now stands. The title 
fairly indicates its intended scope. 

TITLE OF ACT. 

An Act establishing and creating a department of the State 
Mining Bureau for the protection of the natural resources of 
petroleum and gas from waste and destruction through improp- 
er operations in production; 

Providing for the appointment of a State oil and gas super- 
visor ; prescribing his duties and powers ; 

Fixing his compensation; 

Providing for the appointment of deputies and employees; 

Providing for their duties and compensation; 

Providing for the inspection of petroleum and gas wells; 

Requiring all persons operating petroleum and gas wells to 
make certain reports; 

Providing procedure for arbitration of departmental rulings; 

Creating a fund for the purposes of the Act ; 

Providing for assessment of charges to be paid by operators 
and providing for the collection thereof; and 

Making an appropriation for the purposes of this Act. ' 



STATE STATUTES o5-> 

Department of Petroleum and Gas Created. Supervisors. 

Sec. 1. A separate department of the State Mining Bureau 
is hereby established and created to be known as the department 
of 'petroleum and gas. Such department shall be under the 
general jurisdiction of the State mineralogist. He shall appoint 
a supervisor who shall be either a competent engineer or geolo- 
gist experienced in the development and production of petrol- 
eum or a competent oil operator, having had not less than five 
3'ears' actual experience in California oil fields, and who shall 
be designated the "State oil and gas supervisor,'-' and whose 
term of office shall be four years from the date of his appoint- 
ment. Act of June 10, 1915. Amended May 25, 1919. In effect 
July 25, chap. 536. 

Salaries. Assistants. 

Sec. 2. For his services in the general supervision of said 
department, the State mineralogist shall receive as compensa- 
tion one thousand four hundred dollars annually, which shall 
be in addition to his compensation fixed in section 2 of the Act 
of June 16, 1913, relating to the State Mining Bureau. 

The secretary of the State Mining Bureau shall receive for 
his services in connection with the department of petroleum 
and gas, a sum not to exceed six hundred dollars annually, 
which sum shall be in addition to his compensation paid from 
the funds of the State Mining Bureau. 

The supervisor shall receive an annual salary of six thousand 
dollars, and shall be allowed his necessary traveling expenses. 
The State mineralogist may, at the request of the State oil and 
gas supervisor, and subject to the civil service laws of the State, 
appoint one chief clerk at a salary of not to exceed one thou- 
sand eight hundred dollars annually; twelve office assistants or 
stenographers each at a salary not to exceed one thousand two 
hundred dollars annually; four geological draftsmen each at a 
salary not to exceed one thousand five hundred dollars an- 
nually; four petroleum engineers each at a salary not to exceed 
two thousand four hundred dollars annually; twelve inspectors 



556 MORRISON'S OIL RIGHTS 

each at a salary not to exceed one thousand eight hundred dol- 
lars annually. 

The additional salary herein authorized to be paid to the 
State mineralogist and the Secretary of the State Mining Bu- 
reau and the salaries of the supervisor and of the deputies, 
clerks, stenographers, assistants and other employees shall be 
paid out of the funds hereinafter provided for at the times and 
in the manner that salaries of other State officers and employees 
are paid. Act 1917 amending Act 1915. 

Duties of Supervisor Enumerated. 

Sec. 3. It shall be the duty of the State oil and gas super- 
visor so to supervise the drilling, operation and maintenance 
and abandonment of petroleum or gas wells in the State of Cali- 
fornia, as to prevent, as far as possible, damage to underground 
petroleum - and gas deposits from infiltrating water and other 
causes and loss of petroleum and natural gas. Act 1915, p. 1404. 

Duties of Deputies. Attorney. 

Sec. 4. It shall be the duty of the State oil and gas super- 
visor to appoint one chief deputy and five field deputies, one 
for each of the districts hereinafter provided for, and prescribe 
their duties and fix their compensation, which shall not exceed 
four thousand dollars per annum for the chief deputy, and not 
to exceed three thousand six hundred dollars per annum for 
each field deputy. Such deputies shall serve during the pleas- 
ure of the supervisor. He shall also employ an attorney at a 
compensation not exceeding three thousand dollars per year, 
payable out of said fund. The supervisor and the deputies shall 
not be subject to the civil service Act. Act of 1919 amending 
Act of 1917 which amended Act of 1915. 

Qualification of Deputies. Office to Be Kept Open. 

Sec. 5. The chief deputy appointed by the supervisor shall 
be a competent engineer or geologist experienced in the develop- 
ment and production of petroleum; and each field deputy shall 
be either a competent engineer or geologist, experienced in the 



STATE STATUTES 557 

development and production of petroleum, or shall be a com- 
petent and experienced oil. operator, having* had not less than 
five years actual experience in the oil fields of the State of Cali- 
fornia. At the time any Held deputy is appointed, notice of 
such appointment shall be transmitted in writing- to the board 
of commissioners of the district for which said deputy is ap- 
pointed, which field deputy shall maintain an office in the dis- 
trict for which he is appointed convenient of access to the petro- 
leum and gas operators therein. The office shall be open and 
the deputy shall be present at certain specified times, which 
shall be posted at such office. Act of 1919 amending Act of 
1917 which amended Act of 1915. 

Deputies to Collect Information. 

Sec. 6. It shall be the duty of each deputy to collect all neces- 
sary information regarding the oil wells in the district, with 
a view to determining the presence and source of water in the 
oil sand, and to make all maps and other accessories necessary 
to determine the presence and source of water in the oil sands. 
This work shall be done with the view to advising the operators 
as to the best means of protecting the oil and gas sands, and 
with a veiw to aiding the supervisor in ordering tests or repair 
work at wells. All such data shall be kept on file in the office 
of the deputy oil and gas supervisor of the respective district. 
Act 1915, p. 1404. 

Records Open to Inspection. 

See. 7. The records of any and all operators, when filed with 
the deputy supervisor as hereinafter provided, shall be open to 
inspection to those authorized in writing by such operators, to 
the state officers, and to the board of commissioners hereinafter 
provided for. Such records shall in no case other than those 
hereinafter and in this section provided, be available as evidence 
in Court proceedings and no officer or employee or member of 
any board of commissioners shall be allowed to give testimony 
as to the contents of said records, except at such Court proceed- 
ings as are hereinafter provided for in the review of the deci^ 



558 MORRISON'S OIL RIGHTS 

sion of the State oil and gas supervisor, or a board of commis- 
sioners, or in any proceedings initiated for the enforcement of 
an order of the supervisor, or any proceeding initiated for the 
enforcement of a lien created by this Act, or any proceeding for 
the collection of the assessment levied under and pursuant to 
the provisions of this Act or in criminal proceedings arising out 
of such records, or the statements upon which they are based. 
Act 1915, p. 1404. Amended 1917, p. 1588. 

Protection Against Water. Right of Appeal. 

Sec. 8. It shall be the duty of the supervisor to order such 
tests or remedial work as in his judgment are necessary to pro- 
tect the petroleum and gas deposits from damage by under- 
ground water, to the best interests of the neighboring property 
owners, and the public at large. 

The order shall be in written form, signed by the supervisor, 
and shall be served upon the owner of the well, or the local 
agent appointed by such owner, either personally or by mailing 
a copy of said order to the post office address given at the time 
the local agent is designated, or if no such local agent has been 
designated, by mailing a copy of said order to the last known 
post office address of said owner, or if the owner be unknown 
by posting a copy of said order in a conspicuous place upon the 
property, and publishing the same in some newspaper of general 
circulation throughout the county in which said well is located, 
once a week for two successive weeks. 

Said order shall specify the condition sought to be remedied 
and the work necessary to protect such deposits from damage 
from underground waters. For this purpose each operator or 
owner shall designate an agent, giving his post office address, 
who resides within the county where the well or wells are lo- 
cated, upon whom all orders and notices provided for in this 
Act may be served. 

Whenever the supervisor or any deputy supervisor or in- 
spector makes any written recommendation or gives any written 
direction concerning the drilling, testing or other operation in 
any oil or gas well drilled, in process of drilling or being aban- 
doned, and the operator, owner or representative of either, 



STATE STATUTES 559 

serves written notice, either personally or by mail, addressed 
to the supervisor or his deputy at his office in the district, re- 
questing that a definite order be made upon such subject, the 
supervisor or his deputies shall, within five days after such 
notice, deliver a final written order on such subject matter in 
such manner and form that an appeal may be taken at once 
therefrom, to the board of oil and gas commissioners of the dis- 
trict created under this chapter. Act of 1919 amending 1917 
which amended original section 8 of 1915. 

Appeal from Supervisors Order. 

Sec. 9. The well owner, or his or its local agent, may, within 
ten days from the date of the service of any order from the 
supervisor or his chief deputy or field deputy, file with the 
supervisor or his deputy in the district where the property is 
located, a written statement that the order is not acceptable, 
and that appeal from said order is taken to the board of com- 
missioners of said district under the provisions of this chapter. 
Such appeal shall operate as a stay of any order issued under 
or pursuant to the provisions of this Act. Immediately upon 
the filing of such notice of appeal, the deputy supervisor of the 
district, as Secretary ex officio of the board of oil and gas com- 
missioners, shall immediately call a meeting of said commission- 
ers to hear and pass upon said appeal. The hearing upon said 
appeal before said district board of oil and gas commissioners, 
shall be de novo and at such place in the district as the commis- 
sioners may designate, and within ten days from the taking of 
such appeal; five days' notice in writing shall be given to the 
appellant of the time and place of such hearing, and for good 
cause the commissioners may postpone such hearing on the ap- 
plication of appellant, or the State oil and gas supervisor, or the 
field deputy in said district, for not exceeding five days. Act 
of 1919, amending Act of 1917 which amended 1915. 

Division of State into Districts. 

Sec. 10. For the purposes of this Act the State shall be 
divided into five districts, as follows: 

District No. 1, including the counties of Los Angeles, River-* 
side, Orange, San Diego, Imperial and San Bernardino. 



560 MORRISON'S OIL BIGHTS 

District No. 2, the county of Ventura. 

District No. 3, including the counties of Santa Barbara, San 
Luis Obispo, Monterey, Santa Cruz, San Benito, Santa Clara, 
Contra Costa, San Mateo, Alameda and San Francisco. 

District No. 4, including the counties of Tulare, Inyo and 
Kern. 

District No. 5, including the counties of Fresno, Madera, 
Kings, Mono, Mariposa, Merced and all other counties in Cali- 
fornia not included in any of said other districts. 

There shall be elected at the times and in the manner here- 
inafter provided, district oil and gas commissioners for each 
such districts, as follows: 

For district No. 1, five; for district No. 2, five; for district 
No. 3, five ; for district number 4, seven ; for district No. 5, five. 

Commissioners, How Elected. 

Said district oil and gas commissioners shall be elected by 
vote of the companies, individuals, copartnerships or associa- 
tions, who shall have been assessed, and whose names shall ap- 
pear on the last record of assessments (next preceding such elec- 
tion) for and on account of the fund in this Act provided to be 
raised within said district respectively, said vote to be taken 
at a meeting to be held in each of said districts respectively, 
and on the third Monday in September of each year, such place 
and the time and details of such meeting to be fixed by the 
State oil and gas supervisor, and of which meeting at least two 
weeks' previous notice shall have been given by letter addressed 
to each of said persons, corporations, copartnerships and associa- 
tions, entitled to vote as aforesaid, at his or its post office ad- 
dress or principal place of business. 

At said meeting each of those entitled to vote as herein pro- 
vided may be represented by one person holding the written au- 
thority of such voter to act for him at such meeting. 

At said meeting each voter shall be entitled to one vote for 
each member of the board of district oil and gas commissioners 
who are required to be selected for such district. In addition 
thereto, in each district in which five commissioners are to be 
elected, each voter shall be entitled, for each one hundred dol- 



STxVTB STATUTES 561 

lars, or fraction thereof, which said voter shall have paid in 
accordance with his assessment hereunder, to cast one vote 
for the two commissioners who are elected for three years; and 
in each district in which seven commissioners are to be elected, 
each voter shall be entitled, for each one hundred dollars, or 
fraction thereof, which such voter shall have paid in accordance 
with his last assessment hereunder, to cast one vote for the three 
commissioners who are elected for three years. In all subse- 
quent elections the qualification of voters in the election of a 
commissioner shall be the same as in the election of the commis- 
sioner whose successor in office is being elected. 

Said meeting shall select by ballot, by a majority vote of the 
votes represented, the number of persons as hereinbefore speci- 
fied to act as district oil and gas commissioners for such district. 

In any district entitled to seven commissioners, two shall be 
chosen for a term of one year, two for two years and three for 
three years. In any district entitled <to five commissioners, one 
shall be chosen for a term of one year, two for two years and 
two for three years. 

The chairman and Secretary of the meeting shall issue a 
written certificate to the State oil and gas supervisor, setting 
forth the result of such election, and the name and address of 
each of the persons elected at said meeting as the district oil 
and gas commissioners for said district and the term for which 
each has been elected. No person shall be eligible as a district 
oil and gas commissioner who is not a resident of the district 
for which he is elected, nor shall any person be eligible for 
such position who is not actually engaged in the business of 
oil or gas development or production, within the district. 

Upon receipt of the certificate so made by the chairman and 
Secretary of any such meeting, the State oil and gas supervisor 
shall issue a certificate of election to the respective persons in 
said district named as the district oil and gas commissioners 
for said district, and for the periods of one, two or three years 
from and after the first Monday in October, 1917, as shall be 
shown in such certificate, and until their respective successors 
shall have been elected. 

M. O. R.— 36. 



562 MORRISON'S OIL RIGHTS 

Meetings of Commissioners. 

Within thirty days after their appointment by the State oil 
and gas supervisor, the district oil and gas commissioners for 
each district shall meet at a time and place within the district 
to be designated by the State oil and gas supervisor, and shall 
thereupon select one of the number as chairman. 

The deputy supervisor of the district shall be ex officio Sec- 
retary of said board, and shall keep a record of its proceedings, 
and his office shall be the office of the commissioners. 

Each board of commissioners may appoint one of its number 
as assistant Secretary who shall, in the absence of the Secretary 
keep the minutes of said board, and shall perform such further 
secretarial duties as the board, by resolution, may direct. 

Employment of Attorney. 

m In case of any litigation in which any district board of oil 
and gas commissioners shall be a party, such board shall have 
full authority to employ a competent attorney for each such 
litigation, and to fix his compensation, either before or after 
his services shall be concluded, and said compensation shall, 
when certified by the chairman of said board and by the State 
board of control, be paid from the fund created by this chapter. 

Expenses. 

Said commissioners shall serve without compensation, except 
their necessary traveling expenses and other actual expenses 
incident to their office. 

Stenographer. 

In case of any hearing upon appeal before any board of dis- 
trict oil and gas commissioners, they shall have authority to em- 
ploy a competent stenographer to take the testimony and pro- 
ceedings, and in case either party shall take proceedings in the 
Superior Court by write of certiorari, from any order or deci- 
sions of such board, it shall cause the stenographer so employed 
to make a full transcript of the testimony and proceedings be- 



STATE STATUTES 563 

fore said board of commissioners, and three copies in addition 
to the original thereof. The original and one copy shall be for 
the use of said board of commissioners, and one copy shall be 
furnished to the State oil and gas supervisor, and one copy shall 
be furnished to the owner of the well in question. The cost and 
expense of employing any such stenographer, and the transcrib- 
ing of his notes and making said copies shall be part of the 
expenses of said commissioners, and when certified by the chair- 
man of said board, and audited by the State board of control, 
shall be paid from said fund. 

Certificate of Expenses. 

The traveling expenses of said commissioners, and all actual 
expenses incurred by or under the order of said commissioners 
in the hearing and determination and carrying out of orders 
appealed to them, shall be certified by the deputy supervisor and 
the chairman of such board of supervisors, to the State super- 
visor, and when audited by him and by the State board of 
control, shall be paid from said fund. 

Annual Elections. 

On the third Tuesday in September of each year at an hour t 
and place in said respective districts to be fixed by the State oil / 
and gas supervisor, and of which notices shall have been given 
as hereinbefore specified, the successor of each of the district oil 
and gas commissioners whose term of appointment shall expire 
that year, shall be elected and qualified in the manner and sub- 
ject to the provisions hereinbefore set forth, and the term of 
each shall be for a period of three years from and after the 
first Monday in October next succeeding. 

Recall. 

All, either or any of the district oil and gas commissioners 
elected in any district may be recalled by the votes of a majority 
of the qualified votes of the district entitled to vote as to such 
commissioners, respectively. In ca;ie there shall be filed in the 
office of the State oil and gas supervisor, a written petition 



56i MORRISON'S OIL EIGHTS 

signed by not less tliau forty percent of those entitled to vote as 
to the election of any commissioner or commissioners, asking the 
recall of such commissioner or commissioners, said State oil and 
gas supervisor shall, within ten days thereafter, order and give 
notice of, a special election in such district to fill the office or 
offices of the commissioner or commissioners named in said peti- 
tion for recall; and shall cause notice to be given of said election 
in the manner and for the time required for regular election, 
and said notice shall fix the time and place of such election. 
At such -election, the commissioner or commissioners named in 
such petition for recall shall be voted upon as though candidates 
for election for the unexpired portion of the term for which 
they, respectively, were originally elected, and any other candi- 
date or candidates may, at the same time, be voted upon. It 
shall require a majority of all the qualified votes entitled to 
vote for such commissioners, respectively to constitute an elec- 
tion. In case less than a majority of all qualified votes shall 
be cast for any candidate, said recall shall be deemed to have 
failed as to the Commissioner concerning whose office such vote 
was taken; and in case such commissioner shall receive a ma- 
jority of the votes said recall shall be deemed to have failed, 
and in either of such cases, such commissioner shall con- 
tinue to serve until the expiration of his term, as though no 
such special election had been held. But in case any person 
other than such commissioner shall receive a majority of the 
votes for such unexpired term, then such recall shall become 
effective and the office of the commissioner so recalled shall be 
vacant and upon written certificate of such election being filed 
with the State oil and gas supervisor, the person so chosen and 
elected for such unexpired term shall become the successor of 
the commissioner so recalled, and a certificate of his election 
for such unexpired term shall be issued and transmitted to him 
by the State oil and gas supervisor. And like proceedings shall 
be had in case more than one commissioner shall be included in 
said petition for recall. 

In all recall elections, qualifications for voters and the number 
of votes which they will be entitled to cast shall be the same as 



STATE STATUTES 565 

they respectively were in the election of the commissioner as to 
whom such recall election is being held. 



L, c 



Vacancies. 

In case of vacancy caused by the death, resignation or removal 
from district or ceasing to be engaged in the business of develop- 
ment or production of oil or gas in the district as to the office 
of any commissioner, such vacancy shall be filled until the next 
annual election by the remaining commissioners of such district. 

Officer Interested. Supervisors Duties. 

Upon any subject in which any commissioner is personally 
interested, or upon which any corporation, copartnership, asso- 
ciation or individual by whom he is employed is directly inter- 
ested as a party, such commissioner shall not be entitled to sit 
or vote. The board of commissioners shall be entitled to call 
upon the supervisor for advice, and written report upon any 
matter referred to the board of commissioners, and the super- 
visor shall be entitled to call meetings of the commissioners at 
the office of the field supervisor, upon five days' written notice, 
to obtain their written advice upon any matters relating to his 
work within their district. Act 1919 amending 1917 which 
amended 1915. 

Practice on Complaints. 

Sec. 11. Upon receipt bj r the supervisor or deputy supervisor 
of a written complaint specifically setting forth the condition 
complained against, signed by a person, firm, corporation or 
association owning land or operating wells within a radius of 
one mile of any well or group of wells complained against, or 
upon the written complaint specifically setting forth the condi- 
tion complained against, signed by any one of the board of com- 
missioners for the district in which said well or group of wells 
complained against is situated, the supervisor must make an 
investigation of said well or wells and render a written report 
stating the work required to repair the damage complained of. 
or stating that no work is required. A copy of said order must 



566 MORRISON'S OIL RIGHTS 

be delivered to the complainant, or if more than one, each of 
said complainants, and if the supervisor order the damage re- 
paired, a copy of such order shall be delivered to each of the 
owners, operators or agents having in charge the well or wells 
upon which the work is to be done. Said order shall contain a 
statement of the conditions sought to be remedied or repaired 
and a statement of the work required by the supervisor to re- 
pair such condition. Service of such copies shall be made by 
mailing to such persons at the post office address given. Act 
1915, p. 1404, 1917, p. 1592. 

Conduct of Investigations. 

Sec. 12. In any proceeding before the board of commissioners 
as herein provided, or in any other proceeding or proceedings 
instituted by the supervisor for the purpose of enforcing or 
carrying out the provisions of this Act, or for the purpose of 
holding an investigation to ascertain the condition of any well 
or wells complained of, or which in the opinion of the super- 
visor may reasonably be presumed to be improperly drilled, 
operated, maintained or conducted, the supervisor and the chair 
man of the board of commissioners shall have the power to ad- 
minister oaths and may apply to a judge of the Superior Court 
of the State of California, in and for the county in which said 
proceeding or investigation is pending, for a subpoena for wit- 
nesses to attend at said proceeding or investigation. Upon said 
application of said supervisor or said chairman of said board 
of commissioners, said judge of said Superior Court must issue 
a subpoena directing said witness to attend said proceeding or 
investigation; provided, however, that no person shall be re- 
quired to attend upon such proceeding, either with or without 
such books, papers, documents' or accounts unless residing with- 
in the same county or within thirty miles of the place of attend- 
ance. But the supervisor or the chairman of the board of com- 
missioners may in such case cause the depositions of witnesses 
residing within or without the state to be taken in the manner 
prescribed by law for like depositions in civil actions in Superior 
Courts of this State, and to that end may, upon application to 
a judge of the Superior Court of the county within which said 



STATE STATUTES 567 

proceeding or investigation is pending, obtain a subpoena com- 
pelling the attendance of witnesses and the production of books, 
papers and documents at such places as he may designate within 
the limits hereinbefore prescribed. Witnesses shall be entitled 
to receive the fees and mileage fixed by law in civil causes, pay- 
able from the fund hereinafter created. In case of failure or neg- 
lect on the part of any person to comply with any order of the 
supervisor as hereinbefore provided, or any subpoena, or upon 
the refusal of any witness to testify to any matter regarding 
which he may lawfully be interrogated, or upon refusal or neglect 
to appear and attend at any proceeding or hearing on the day 
specified, after having received a written notice of not less than 
ten days prior to such proceeding or hearing, or upon his fail- 
ure, refusal or neglect to produce books, papers or documents 
as demanded in said order or subpoena upon such day, such 
failure, refusal or neglect shall constitute a misdemeanor and 
each day's further failure, refusal or neglect shall be and be 
deemed to be a separate and distinct offense, and it is hereby 
made the duty of the district attorney of the county in which 
said proceeding, hearing or investigation is to be held, to prose- 
cute all persons guilty of violating this section by continuous 
prosecution until such person appears or attends or produces 
such books, papers or documents or complies with said sub- 
poena or order of the supervisor or chairman of the board of 
commissioners. Act 1915, p. 1404, 1917, p. 1593. 

Written Decisions. Review by Certiorari. 

Sec. 13. Within ten days after hearing the evidence, the 
board of commissioners must make a written decision with 
respect to the order appealed from, and in case the same is 
affirmed or modified, shall retain jurisdiction thereof until such 
time as the work ordered to be done by such order shall be 
finally completed. This written decision shall be served upon 
the owner or his agent and shall supersede the previous order 
of the supervisor. In case no written decision be made by said 
board of commissioners within thirty days after the date of 
notice by the supervisor as provided in section ten hereof, the 
order of the supervisor shall be effective and subject only to re- 



568 MORRISON'S OIL RIGHTS 

view by writ of certiorari from the superior court as provided 
in section fourteen hereof. Act 1915, p. 1404, 1917, p. 1594, 

Practice on Review. Enforcing Repairs. 

Sec. 14. On or before thirty days after the date of serving 
an order of the supervisor, provided for in section eight hereof, 
or in case of appeal to the board of commissioners, on or before 
thirty days after date of serving the decision of the board, as 
provided in sections twelve and thirteen hereof, or in the event 
review be taken of the order of the board of commissioners 
within ten days after affirmance of such order, the owner shall 
commence in good faith the work ordered and continue untn 
completion. If the work has not been so commenced ana con- 
tinued to completion, the supervisor shall appoint agents as he 
deems necessary who shall enter the premises and perform the 
work. Accurate account of such expenditures shall be kept and 
the amount paid from the fund hereinafter created upon the 
warrant of the State Controller. Any amount so expended 
shall constitute a lien against the property upon which the work 
is done. The decision of the board of commissioners in such 
case may be reviewed by writ of certiorari from the Superior 
Court of the county in which the district is situated, if taken 
within ten days after the service of the order upon said owner, 
operator or agent of said owner or operator as herein provided ; 
or within ten days after decision by the board of commissioners 
upon petitions by the supervisor. Such writ shall be made 
returnable not later than ten days after the issuance thereof 
and shall direct the district board of oil and gas commissioners 
to certify their record in the cause to such Court. On the re- 
turn day the cause shall be heard by the Court unless for good 
cause the same be continued, but no continuance shall be per- 
mitted for a. longer period than thirty days. No new or addi- 
tional evidence shall be introduced in the Court before the 
(tause shall be heard upon the record of the district board of 
oil and gas commissioners. The review shall not be extended 
further than to determine whether or not — 

1. The Commission acted without or in exce^^ of its juris- 
diction. 



STATE STATUTES 569 

2. The order, decision or award was procured by fraud. 

3. The order, decision, rule or regulation is unreasonable. 

4. The order, decision, regulation or award is clearly unsup- 
ported by the evidence. 

If no review be taken within ten days, or if taken in case 
the decision of the board is affirmed, the lien upon the property 
shall be enforced in the same manner as the other liens on real 
property are enforced, and shall first be enforced against the 
owner of the well, against the operator and against the personal 
property and fixtures used in the construction or operation 
thereof, and then if there be any deficiency against the land 
upon which the work is done, upon the request of the supervisor, 
the State Controller must, in the manner provided in section 
forty-four of this Act, bring an action for the enforcement of 
said lien. Act 1915, p. 1404, 1917, p. 1594. 

Regulation of Casing. Protection against Water. 

Sec. 15. It shall be the duty of the owner of any well now 
drilled, or that may be drilled in the State of California, on 
lands producing or reasonably presumed to contain petroleum 
or gas, to properly case such well or wells w T ith metal casing, 
in accordance with methods approved by the supervisor, and 
to use every effort and endeavor in accordance with the most 
approved methods to effectually shut off all water overlying 
or underlying the oil or gas-bearing strata, and to effectually 
prevent any water from penetrating such oil or gas-bearing 
strata. 

Whenever it appears to the supervisor that any water is 
penetrating oil or gas-bearing strata, he may order a test of 
water shut-off and designate a day upon which the same shall 
be held. Said order shall be in written form and served upon 
the owner of said well at least ten days prior to the day de- 
signated in said order as the day upon which said shut-off test 
shall be held. Upon the receipt of such order it shall be the 
duty of the owner to hold said test in the manner and at the time 
prescribed in said order. Act 1915, p. 1404, 1917, p. 1595. 



570 MORRISON'S OIL RIGHTS 

Regulation of Abandonment of Well. 

Sec. 16. It shall be the duty of the owner of any well referred 
td in this Act, before abandoning the same, or before removing 
the rig, derrick or other operating structure therefrom, or re- 
moving any portion of the casing therefrom, to use every effort 
and endeavor in accordance with methods approved by the 
supervisor, to shut off and exclude all water from entering oil- 
bearing* strata encountered in the well. Before any well is 
abandoned the owner shall give written notice to the supervisor, 
or his local deputy, of his intention to abandon such well and 
of his intention to remove the derrick or any portion of the cas- 
ing from such well and the date upon which such work of 
abandonment Or removal shall begin. The notice shall be given 
to the supervisor, or his local deputy, at least five days before 
such proposed abandonment or removal. The owner shall fur- 
nish the supervisor, or his deputy with such information as he 
may request showing the condition of the well and proposed 
method of abandonment or removal. The supervisor, or his de- 
puty, shall before the proposed date of abandonment or 'removal, 
furnish the owner with a written order of approval of his pro- 
posal or a written order stating what work will be necessary 
before approval, to abandon or remove will be given. If the 
supervisor shall fail within the specified time to give the owner 
a written order such failure shall be considered as an approval 
of the owner's proposal to abandon the well, or to remove the 
rig or casing therefrom. Act 1915, p. 1404, 1917, p. 1596. 

Notice of Intention to Commence Drilling. 

Sec. 17. The owner or operator of any well referred to in 
this Act shall, before commencing the work of drilling an oil 
or gas well, file with the supervisor, or his local deputy, a writ- 
ten notice of intention to commence drilling. Such notice shall 
also contain the following information: (1) Statement of lo- 
cation and elevation above sea level of the floor of the proposed 
derrick and drillrig; (2) the number or other designation by 
which such well shall be known, which number or designation 
shall not be changed after filing the notice provided for in this 



STATE STATUTES 571 

section, without the written consent of the supervisor being ob- 
tained therefor; (3) the owner's or operator's estimate of the 
depth of the point at which water will be shut off, together with 
the method by which such shut-off is intended to be made and the 
size and weight of casing to be used; (4) the owner's or oper- 
ator's estimate of the depth at which oil or gas producing sand 
or formation will be encountered. 

After the completion of any well the provisions of this sec- 
tion shall also apply, as far as may be, to the deepening or re- 
drilling of any well, or any operation involving the plugging of 
any well or any operations permanently altering in any manner 
the casing of any well; and provided, further, that the number 
or designation by which any well heretofore drilled has been 
known, shall not be changed without first obtaining a written 
consent of the supervisor. Act 1915, p. 1404, 1917, p. 1596. 

Items of Log of Well. Prospect Wells. 

Sec. 18. It shall be the duty of the owner or operator of any 
well referred to in this Act, to keep a careful and accurate log 
of the drilling of such well, such log to show the character and 
depth of the formation passed through or encountered in the 
drilling of such well, and particularly to show the location and 
depth of the water-bearing strata, together with the character 
of the water encountered from time to time (so far as ascer- 
tained) and to show at what point such water was shut off, if 
at all, and if not, to so state in such log, and show completely 
the amounts, kinds and size of casing used, and show the depth 
at which oil-bearing strata are encountered, the depth and char- 
acter of same, and whether all water overlying and underlying- 
such oil-bearing strata was successfully and permanently shut 
off so as to prevent the percolation or penetration into such oil- 
bearing strata; such log shall be kept in the local office of the 
owner or operator, and together with the tour reports of said 
owner or operator, shall be subject, during business hours, to 
the inspection of the supervisor, or any of his deputies, or any 
of the commissioners of the district, except in the case of a 
prospect well as hereinafter defined. Upon the completion of 
any well, or upon the suspension of operations upon any well. 



572 MORRISON'S OIL RIGHTS 

for a period of six months if it be a prospect well, or for thirty- 
days, if it be in proven Territory, a copy of said log in dupli- 
cate, and in such, form as the supervisor may direct, shall be 
filed within ten days after such completion, or after the expira- 
tion of said thirty-day period, with the field supervisor, and a 
like copy shall be filed upon the completion of any additional 
work in the deepening of any such well. 

The State oil and gas supervisor shall determine and desig- 
nate what wells are prospect wells within the meaning of this 
Act, and no reports shall be required from such prospect wells 
until six months after the completion thereof. 

The owner or operator of any well drilled previous to the 
enactment of this Act shall furnish to the supervisor or his 
deputy a complete and correct log in duplicate and in such 
form as the supervisor may direct, or his deputy, of such well, 
so far as may be possible, together with a statement of the pres- 
ent condition of said well. Act 1915, p. 1404, 1917, p. 1597. 

Shut-off of Well Regulated. 

Sec. 19. It shall be the duty of the owner or operator of any 
well referred to in this Act to notify the deputy supervisor of the 
time at which the owner or operator shall test the shut-off of 
water in any such well. _Such notice shall be given at least 
five days before such test. The deputy supervisor or an in- 
spector designated by the supervisor shall be present at such 
test and shall render a report in writing of the result thereof 
to the supervisor a duplicate of which shall be delivered to the 
owner. If any test shall be unsatisfactory to the supervisor he 
shall so notify the owner or operator in said report, and shall 
within five days after thw completion of such test, order addi- 
tional tests of such work as he deems necessary to properly shut 
off the water in such well and in such order shall designate a 
day upon which the owner or operator shall again test the shut- 
off of water in any such well, which day may, upon the applica- 
tion of the owner, be changed from time to time in the dis- 
cretion of the deputy supervisor. Act 1915, p. 1404, 1917, p. 
1597. 



STATE STATUTES 573 

Monthly Reports of Production. 

Sec. 20. It shall be the duty of every person, association or 
corporation producing oil in the State of California, to file 
with the supervisor, at his request, but not oftener than once 
in each month, a statement showing amount of oil produced 
during the period indicated from each well, together with its 
gravity and the amount of water produced from each well, 
estimated in accordance with methods approved by the super- 
visor, and the number of days during which fluid was produced 
from each well, the number of wells drilling, producing, idle 
or abandoned, owned or operated by said person, association 
or corporation; Provided, that, upon request and satisfactory 
showing a longer interval may be fixed by the State oil and gas 
supervisor as to such reports in the case of any specific owner 
or operator. 

This information shall be in such form as the supervisor 
may designate. Act 1915, p. 1404, 1917, p. 159S. 

Penalties for Violations. 

Sec. 21. Any owner or operator of a well referred to in this 
Act or employee thereof, who refuses to permit the supervisor, 
or his deputy, to inspect the same, or who wilfully hinders or 
delays the enforcement of this Act, and every person, firm or 
corporation who violates any provision of this Act is guilty of 
a misdemeanor and shall be punishable by a fine of not less than 
one hundred dollars, or by imprisonment in the county jail for 
not less than thirty days, or by both such fine and imprisonment. 
Act 1915, p. 1404. 

Public Interest and Police Power Justify Charges. 

Sec. 21a. The charges hereinafter provided for are directed 
to be levied by the State of California as necessary in the exer- 
cise of its police power and to provide a means by which to 
supervise and protect deposits of petroleum and gas within the 
State of California, in which deposits the people of the State 
of California are hereby declared to have a primary and su- 
preme interest. Act 1915, p. 1404, 1917, p. 1598. 



574 MORRISON'S OIL RIGHTS 

Collections for Use of the Department. 

Sec. 22. Charges levied, assessed and collected as hereinafter 
provided npon the properties of every person, firm, corporation 
or association operating any well or wells for the production of 
petroleum in this State, or operating any well or wells for the 
production of natural gas in this State which gas wells are situ- 
ate on lands situate within two miles, as near as may be, of any 
petroleum or gas well, the production of which is chargeable 
under this Act, shall be used exclusively for the support and 
maintenance of the department of petroleum and gas herein- 
before created, and shall be assessed and levied by the State 
mineralogist, and collected in the manner hereinafter provided. 
Act 1915, p. 1404, 1917, p. 1598. 

Tax on Barrels Produced. 

Sec. 23. Every person, firm, corporation or association oper- 
ating any petroleum well or wells in this State shall annually 
pay a charge to the State treasurer at a uniform rate per barrel 
of petroleum produced for the preceding calendar year at the 
time and in the manner hereinafter provided, based upon a 
verified report as herein provided. Act 1915, p. 1404. 

Gas to Pay on Cubic Feet. 

Sec. 24. Every person, firm, corporation or association op- 
erating any gas well or wells in this State shall annually pay a 
charge to the State treasurer based upon the amount of gas 
sold in the preceding calendar year, at a fixed rate per thousand 
<mbic feet, at the times and in the manner hereinafter provided, 
based upon a verified report as herein provided. Act 1915, p. 
1404, 1917, p. 1599. 

Assessment of Charges against Land. 

Sec. 25. Every person, firm, corporation or association own- 
ing any oil land, as determined by the supervisor, shall annually 
pay a charge to the State treasurer at the time and in the manner 
hereinafter provided, which charge shall be a uniform rate per 



STATE STATUTES 575 

acre. Said charge shall be based upon a verified report as pro- 
vided herein; provided, however, that such lands so assessed 
shall not be called upon to pay more than one-tenth of the total 
charges or moneys proposed to be assessed, levied and collected 
under the provisions of this Act for any one year. Act 1915 7 
p. 1404. 

All Charges Additional. 

Sec. 26. The charges assessed, levied and to be collected un- 
der the provisions of this Act shall be in addition to any and ail 
charges, taxes, assesments or licenses of any kind or nature paid 
by or upon the properties assessed hereunder. Id. 

Annual Estimate for Expenses. 

Sec. 27. The State mineralogist shall annually, on or before 
the first Monday in March, acting in conjunction with the State 
board of control, make an estimate of the amount of moneys 
which shall be required to carry out the provisions of this Act. 

At the time of making such estimate, the State mineralogist 
shall report to the State Board of Control the amount of money 
in the petroleum and gas fund on the day such estimate is 
made, less the amount of money necessary for the support of 
the department of petroleum and gas for the remainder of the 
fiscal year, and the amount of such estimate shall in no event 
exceed the difference between the amount thus determined as 
remaining in the petroleum and gas fund at the end of the 
fiscal year and the sum of one hundred fifty thousand dollars. 
Act 1915, p. 1404, 1917, p. 1599. 

Form of Reports by Owners. 

Sec. 28. The State mineralogist shall prescribe the form and 
contents of all reports for making the charge or other purposes 
to carry out the intent and provision of this Act, which form 
shall be mailed in duplicate to the person, firm, corporation or 
association owning property or assessed under the provisions of 
this Act. Act 1915, p. 1404. 



576 MORRISON'S OIL RIGHTS 

Annual Reports from Operators. 

Sec. 29. Every person, firm, corporation or association 
chargeable under the provisions of this Act shall within ten days 
after the first Monday in March of each year, report to and file 
with the State mineralogist a report in snch form as said officer 
may prescribe, giving any and all items of information as may be 
demanded by said report, and necessary to carry out the pro- 
visions of this Act, which report shall be verified by such person 
or officer as the State mineralogist may designate. Id. 

Procedure on Failure to Report. 

Sec. 30. If any person, firm, corporation or association 
chargeable under the provisions of this Act shall fail or refuse 
to furnish the State mineralogist within the time prescribed in 
this Act the verified report provided for in this Act, the State 
mineralogist must note such failure or refusal in the record of 
assessments hereinafter in this Act provided for, and must make 
an estimate of the petroleum or gas production, or landed area 
to be assessed of any such person, firm, corporation or associa- 
tion and must assess the same at the amount thus estimated 
and compute the charge thereon, which asessment and charge 
shall be the assessment and charge for such year. And if in the 
succeeding yerr any such person, firm, corporation or associa- 
tion shall again fail and refuse to furnish the verified report 
required by this Act, the State mineralogist shall make an es- 
timate as aforesaid, which estimate shall not be less than twice 
the amount of the estimate made by him for the previous year, 
and shall note such failure or refusal as above provided, and the 
said estimate so made shall be the assessment or charge for said 
year. In case of each succeeding consecutive failure or refusal 
the said State mineralogist shall follow the same procedure 
until a true statement or report shall be furnished. Id. 

Penalty for False Report. 

Sec. 31. Any person, firm, corporation or association failing 
or refusing to make or furnish any report which may be re- 
quired pursuant to the provisions of this Act, or who wilfully 



STATE STATUTES oi i 

renders a false or fraudulent report, shall be guilty of a mis- 
demeanor and subject to a fine of not less than three hundred 
dollars, nor more than one thousand dollars, or by imprison- 
ment in the county jail not exceeding six months, or both such 
fine and imprisonment for each such offense. Act 1915, p. 1404, 
1917, p. 1599. 

Extension of Time to Report. 

Sec. 32. The State mineralogist may, for good cause shown, 
by order entered upon his minutes, extend for not exceeding 
thirty days, the time fixed in this Act for filing any report here- 
in provided for. Act 1915, p. 1404. 

Rate of Assessment. 

Sec. 33. On or before the third Monday before the first Mon- 
day in July of each year, the State mineralogist shall determine 
the rate or rates which shall produce the sums necessary to be 
raised as provided in section twenty-seven of this Act. Within 
the same time the said State mineralogist shall extend into the 
proper column of the record of assessments hereinafter provided 
for, the amount of charges due from each person, firm, corpora- 
tion or association. Act 1915, p. 1404, 1917, p. 1599. 

Annual Assessment. Clerical Errors. 

Sec. 34. Between the first Monday in March and the third 
Monday before the first Monday in July in each year, the State 
mineralogist must assess and levy the charges as and in the 
manner provided for in this Act. The assessments must be made 
to the person, firm, corporation or association owning or operat- 
ing the^ property subject to assessment hereunder on the first 
Monday in March. If the name of the owner is unknown to the 
State mineralogist, such assessment must be made to unknown 
owners. Clerical errors occurring or appearing in the name of 
any person, firm, corporation or association whose property is 
properly assessed and charged, or in the making, or extension 
of any assessment or charge upon the records, which do not 
M. O. R.—37. 



578 .MORRISON'S OIL RIGHTS 

affect the substantial rights of the payer, shall not invalidate 
the assessment or charge. Act 1915, p. 1404. 

Board of Equalization. 

Sec. 35. The State mineralogist and the chairman of the 
State Board of Control and the chairman of the State Board of 
Equalization shall constitute a board of review, correction and 
equalization, and shall have all the powers and perform such 
duties as usually devolve upon a county board of equalization 
under the provisions of section three thousand six hundred 
seventy-two of the Political Code. The State mineralogist shall 
act as Secretary of said board, and shall keep an accurate minute 
of the proceedings thereof. Said board of review, correction and 
equalization shall meet at the State Capitol on the third Monday 
before the first Monday in July of each year, and remain in 
session from day to day until the first Monday in July for the 
purpose of carrying out the provisions of this section. Id. 

Publication of Assessment Notice. Correction of Records. 

Sec. 36. On the third Monday before the first Monday in 
July of each year the State mineralogist shall cause to be pub- 
lished a notice, one or more times, in a daily, or weekly, or 
semiweekly newspaper of general circulation published in the 
counties of Fresno, Kern, Los Angeles, Orange, Ventura and 
Santa Barbara, and such other counties as may contain lands 
or produce oil or gas charged under and pursuant to the terms 
and provisions of this Act, if one be published therein, other- 
wise in a newspaper of general circulation published in the 
county nearest to such county designated herein in which no 
such paper is published, that the assessment of property and 
levy of charges under and in pursuance of this Act has been 
completed and that the records of assessments containing the 
charges due will be delivered to the State Controller on the first 
Monday in July, and that if any person, firm, corporation or 
association is dissatisfied with the assessment made or charge 
fixed by the State mineralogist, he or it may, at any time before 
said first Monday in July, apply to said board of review, cor- 



STATE STATUTES 579 

rection and equalization to have the same corrected in any 
particular. The said board shall have the power at any time 
before said first Monday in July to correct the record of assess- 
ments and may increase or decrease any assessment or charge 
therein if in its judgment the evidence presented or obtained 
warrants such action. Costs of such publication in any county 
shall be paid from the petroleum and gas fund; provided, how- 
ever, that the omission to publish said notice as hereinbefore and 
in this section provided, shall not affect the validity of any as- 
sessment levied under or pursuant to the provisions of this Act. 
Act 1915, p. 1404, 1917, p. 1600. 

Public Record of Assessment. 

Sec. 37. The State mineralogist must prepare each year a 
book in one or more volumes, to be called the "Record of assess- 
ments and charges for the petroleum and gas fund," in which 
must be entered, either in writing or printing, or both writing 
and printing, each assessment and levy or charge made by him 
upon the property provided to be assessed and charged under 
this Act, describing the property assessed, and such assessments 
may be classified and entered in such separate parts of said 
record as said State mineralogist shall prescribe. Act 1915, p 
1404, 1917, p. 1600. 

iForm of Certificate of State Mineralogist. 

Sec. 38. On the first Monday in July the State mineralogist 
oust deliver to the State controller the record of assessments 
and charges for the petroleum and gas fund, certified to by said 
State mineralogist, which certificate shall be substantially as 

follows : "I, , State mineralogist, do 

hereby certify that between the first Monday in March and the 
first Monday in July, 19 .... , made diligent inquiry and ex- 
amination to ascertain all property and persons, firms, corpo- 
rations and associations subject to assessment for the purpose 
of the petroleum and gas fund as required by the provisions 
of the Act of legislature approved June 10, 1915, providing 
for the assessment and collection of charges for oil protection ■ 



-580 MORRISON'S OIL RIGHTS 

that I have faithfully complied with all the duties imposed upon 
me by law; that I have not imposed any unjust or double as- 
sessment through malice or ill will, or otherwise ; nor allowed any 
person, firm, corporation or association or property to escape 
a just assessment or charge through favor or regard, or other- 
wise." But the failure to subscribe such certificate to such 
record of assessments and charges for oil protection, or any cer- 
tificate, shall not in any manner affect the validity of any assess- 
ment or charge. Act 1915, p. 1404, 1917, p. 1600. 

Charges, When Due. 

Sec. 39. The charges levied and assessed under the provisions 
of this Act shall be due and payable on the first Monday in July 
in each year, and one-half thereof shall be delinquent on the 
sixth Monday after the first Monday in July at six o'clock p. m. 
and unless paid prior thereto, fifteen per cent shall be added to 
the amount thereof, and unless paid prior to the first Monday in 
February next thereafter at six o'clock p. m., an additional five 
per cent shall be added to the amount thereof, and the unpaid 
portion, or the remaining one-half of said charges shall become 
delinquent on the first Monday in February next succeeding, the 
day upon which they become due and payable, at six oclock 
p. m. ; and if not paid prior thereto five per cent shall be added 
to the amount thereof. Act 1915, p. 1404. 

Public Notice of Date to Pay Dues. 

Sec. 40. Within ten days after the receipt of the record oi 
assessments and charges for oil protection, the State controller 
must begin the publication of a notice to appear daily for five 
days, in one daily newspaper of general circulation published 
in each of the counties of Fresno, Kern, Los Angeles, Orange, 
Ventura and Santa Barbara, and such other counties as may 
contain lands or produce oil or gas charged under or pursuant 
to the terms and provisions of this Act, if one be published 
therein, otherwise for at least two times in a weekly or semi 
weekly paper of general circulation published therein, or ii 
there be neither a daily nor weekly nor semi-weekly paper of 



STATE STATUTES 581 

general circulation published in any one of such counties, then 
the publication of the notice for such county shall be made in 
a similar manner in a newspaper of general circulation pub- 
lished in the county nearest such county, specifying: (1) That 
he has received from the State mineralogist the record of assess- 
ments and charges for oil protection; (2) that the charges there- 
in assessed and levied are due and payable on the first Monday 
in July and that one-half thereof will be delinquent on the sixth 
Monday after the first Monday in July at six o'clock p. m., and 
that unless paid to the State treasurer at the capitol prior 
thereto, fifteen per cent will be added to the amount thereof, 
and unless paid prior to the first Monday in February next there- 
after at six o'clock p. m., an additional five per cent will be 
added to the amount thereof; and that the remaining one-half 
of said charges will become delinquent on the first Monday in 
February next succeeding the day upon which they become due 
and payable, at six o'clock p. m., and if not paid to the State 
treasurer at the capitol prior thereto, five per cent will be added 
to the amount thereof. Costs of such publication in any county 
shall be paid from the petroleum and gas fund. Act 1915, p. 
1404, 1917, p. 1601. 

Assessments Made a Lien. 

Sec. 41. The assessments and charges levied under the pro- 
visions of this Act shall constitute a lien upon all the property 
of every kind and nature belonging to the persons, firms, cor- 
porations and associations assessed under the provisions hereof, 
which lien shall attach- on the first Monday in March of each 
year. Such lien shall be enforced and said charges collected by 
an action by the State controller as provided in section forty 
four of this Act. Id. 

Payments to Be Made to State Treasurer. 

Sec. 42. All charges assessed and levied under the provisions 
of this Act shall be paid to the State treasurer upon the order oi 
the State controller. The controller must mark the date of pay- 
ment of any charge on the record of assessments for the petro- 



0S2 MORRISON »S OIL RIGHTS 

leum and gas fund and shall give a receipt for such paymeni 
in such form as the controller may prescribe. Errors appearing 
upon the face of any assessment on said record of assessments 
or overcharges may be corrected by the controller by and with 
the consent of the State board of control, in such manner and at 
such time as said controller and said board shall agree upon. 
Id. 

Contest of Charges. 

Sec. 43. Any person, firm, corporation or association claim- 
ing and protesting as herein provided that the assessment made 
or charges assessed against him or it by the State mineralogist 
is void, in whole or in part, may bring an action against tho> 
State treasurer for the recovery of the whole or any part o± 
such charges, penalties or costs paid on such assessment, upon 
the grounds stated in said protest, but no action may be brought 
later than the third Monday in February next following the 
day upon which the charges were due, nor unless such person, 
firm, corporation or association shall have filed with the State 
controller at the time of payment of such charges, a written 
protest stating whether the whole assessment or charge is 
claimed to be void, or if a part only, what part, and the grounds 
upon which such claim is founded, and when so paid under 
protest the payment shall in no case be regarded as voluntary. 

Whenever, under the provisions of this section, an action :'s 
commenced against the State treasurer, a copy of the complaint 
and of the summons must be served upon the treasurer, or his 
deputy. At the time the treasurer demurs or answers, he may 
demand that the action be tried in the Superior Court of the 
county of Sacramento, which demand must be granted. The 
attorney employed by the State oil and gas supervisor must 
defend such action ; provided, however, the said mineralogist 
may at the request of the said oil and gas supervisor employ 
additional counsel, the expense of which employment shall be 
paid from the petroleum and gas fund. The provisions of the 
("ode of Civil Procedure relating to pleadings, proofs, trials 
and appeals are applicable to the proceedings herein provided 
for. 



STATE STATUTES 583 

A failure to begin such action within the time herein specified 
shall be a bar against the recovery of ouch charges. In any 
such action the Court shall have the power to render judg- 
ment for the plaintiff for any part or portion of the charge, 
penalties, or costs found to be void and so paid by plaintiff 
upon such assessment. Id. 

Collection of Delinquent Charges. 

Sec. 44. The State controller shall, on or before the thirtieth 
day of May next following the delinquency of any charge as 
provided in this Act, bring an action in a Court of competent 
jurisdiction, in the name of the people of the State of Cali- 
fornia, in the county in which the property assessed is situated, 
to collect any delinquent charges or assessments, together with 
any penalties or costs, which have not been paid in accordance 
with the provisions of this Act and appearing delinquent upon 
the records of assessments and charges for the petroleum and 
gas fund in this action provided for. 

The attorney for the State oil and gas supervisor shall com- 
mence and prosecute such action to final judgment and the 
provisions of the Code of Civil Procedure relating to service 
of summons, pleadings, proofs, trials and appeals are applicable 
to the proceedings herein provided for. The State mineralogist 
may employ additional counsel to assist . the attorney for the 
State oil and gas supervisor, and the expense of such employ- 
ment shall be paid from the petroleum and gas fund. 

Payments of the penalties and charges, or amount of the 
judgment recovered in such action must be made to the State 
treasurer. In such actions the record of assessment and charges 
for oil protection, or a copy of so much thereof as is applicable 
in said action, duly certified by the controller showing unpaid 
charges against any person, firm, corporation or association as- 
sessed by the State mineralogist is prima facie evidence of the 
assessment upon the property, the delinquency, the amount of 
charges, penalties, and costs due and unpaid to the State, and 
that the person, firm, corporation or association is indebted to 
the people of the State of California in the amount of charges 
and penalties therein appearing unpaid and that all the forms 



~>$± MORRISON'S OIL RIGHTS 

of law in relation to the assessment of such charges have been 
complied with. Id. 

Assessment Periods. 

Sec. 45. The first assessment under the provisions of this Act 
shall be as of the first Monday in March, nineteen hundred six- 
teen, and the reports of petroleum production and sales of gas 
herein provided to be assessed shall be reported for the calen- 
dar year ending December thirty-first, nineteen hundred fifteen. 
The lands herein provided to be assessed and charged shall be 
assessed to the owners thereof as of the first Monday in March, 
nineteen hundred sixteen. Act 1915, p. 1404. 

Petroleum and Gas Fund. 

Sec. 46. All the moneys heretofore paid to the State treasurer 
under or pursuant to the provisions of this Act and deposited 
to the credit of the oil protection fund, shall be withdrawn from 
said fund, which is hereby abolished, and deposited to the credit 
of the petroleum and gas fund which is hereby created. All of 
the moneys hereafter paid to the State treasurer under or pur- 
suant to the provisions of this Act shall be deposited to the 
credit of the petroleum and gas fund. All moneys in such fund 
shall be expended under the direction of the State mineralogist, 
drawn from such fund for the purpose of this Act upon war- 
rants drawn by the controller of the State, upon demands made 
by the State mineralogist, and audited by the State Board of 
Control. Of the moneys in said petroleum and gas fund, when 
such action lias been authorized by the State board of control, 
the State Mining Bureau may withdraw, without at the time 
furnishing vouchers and itemized statements, a sum not to ex- 
reed five hundred dollars, said sum so drawn to be used as a 
revolving fund where cash advances are necessary. At the close 
of each fiscal year, or at any other time, upon demand of the 
board of control, the moneys so drawn shall be accounted for and 
substantiated by vouchers and itemized statements submitted 
to and audited by the board of control. Act 1915, p. 1404, 1917, 
p. 1603. 



STATE STATUTES 585 

Moneys to Be Credited to Such Fund. 

Sec. 47. All moneys received in repayment of repair work 
done under the order and direction of the supervisor as here- 
inbefore provided, shall be returned and credited to the petro- 
leum and gas fund. Id. 

Annual Production and Finance Report by Supervisor. 

Sec. 48. On or before the first day of October of each and 
every year the supervisor shall submit a report in writing to 
the State mineralogist showing the total number of barrels of 
petroleum produced in each county in the State during the 
previous calendar year, together with the total cost of said de- 
partment for the previous fiscal year and the net amount 
remaining in the petroleum and gas fund available for the 
succeeding fiscal year's expense, also the total amount delinquent 
and uncollected from any assessments or charges levied under 
or pursuant to the provisions of this Act. Such report shall 
also include such other information as the supervisor may deem 
advisable. The State mineralogist shall make public such state- 
ments promptly after receipt of the same from the supervisor 
for the benefit of all parties interested therein. Id. 

Lease Reports to Supervisor. 

Sec. 49. The owner or operator of any lands or tenements 
subject to assessment under this Act shall, within six months 
after this Act goes into effect, file with the supervisor a certifi- 
cate which shall contain the names of all the parties claiming 
an interest in or to said lands and full description of the prop- 
erty ancf the names of all parties in interest where such interest 
is held by lease, license or assignment. Id. 

Supervisor and Other Terms Defined. 

Sec. 50. Whenever the term "supervisor" is used in this Act 
it shall be taken to mean the "State oil and gas supervisor," the 
term "oil" shall include "petroleum," the term "petroleum" shall 
include "oil," the term "gas" shall mean natural gas coming 



586 MORRISON'S OIL RIGHTS 

from the earth, the term "operator" shall mean any person, firm 
or corporation drilling, maintaining, operating, pumping, or in 
control of a well in any territory which the supervisor deter- 
mines to be oil or gas producing territory, the term "owner" 
shall include "operator" when any oil or gas well is operated or 
has been operated or is about to be operated by any person, firm 
or corporation other than the owner thereof, and the term "op- 
erator" shall include "owner" when any such well is or has been 
or is about to be operated by or under the direction of the owner, 
except that all the provisions of this Act relating to assessments 
for the purposes of this Act based upon the annual production 
of oil or petroleum or sale of gas, as set forth in sections twenty- 
two to forty-five, inclusive, of this Act, shall apply only to a 
person, firm or corporation operating an oil or petroleum or 
gas well, and shall not apply to the owner of such well if some 
person, firm or corporation, other than such owner, has been 
actually operating the well during the whole period for which 
such annual charge is made, but in the event that the actual op- 
eration of any such well changes hands during such period, the 
charge shall be apportioned upon the basis of the oil or petro- 
leum or gas produced, and the lien provided for in section forty- 
one of this Act shall be a lien against the property of each and 
all such operators. Act 1915, p. 1404. 

$20,000 First Appropriation. 

Sec. 51. There is hereby appropriated out of any moneys in 
the State treasury, not otherwise appropriated, the sum of 
twenty thousand dollars, which said sum shall be immediately 
transferred by the State controller on the books of his office 
from the general fund to the "oil protection fund" cheated by 
section forty-six of this Act. 

The above mentioned fund shall be available for the uses of 
the State mineralogist for the maintenance of the department of 
petroleum and gas and for the necessary expenses of the con- 
troller in carrying out the provisions of this Act. When the 
collections paid to the State treasurer, as herein provided, equal 
the sum of thirty thousand dollars then said sum of twenty 
thousand dollars shall be retransferred from the oil protection 



STATE STATUTES 587 

fund to the general fund. The moneys reeeived into the State 
treasury through the provisions of this Act are hereby appro- 
priated for the uses and purposes herein specified. Id. 

The Constitutional Clause. 

Sec. 52. If any section, subsection, sentence, clause or phrase 
of this Act is for any reason held to be unconstitutional, such 
decision shall not affect the validity of the remaining portions of 
this Act. The legislature hereby declares that it would have 
passed this Act, and each section, subsection, sentence, clause 
and phrase thereof, irrespective of the fact that any one or more 
other sections, subsections, sentences, clauses or phrases be de- 
clared unconstitutional. Id. 

Liberal Construction. Wells in Cities. 

Sec. 53. This Act shall be liberally construed to meet its pur- 
poses and the supervisor shall have all powers which may be 
necessary to carry out the purposes of this Act, but the provi- 
sions of this Act shall not apply to any land or wells situated 
within the boundaries of an incorporated city where the drilling 
of oil wells is prohibited. Id. 

Repeal of Prior Acts. Mining Bureau. 

Sec. 54. That certain Act entitled "An Act to prevent injury 
to oil, gas or petroleum-bearing strata or formations by the 
penetration or infiltration of water therein," approved March 
20, 1909, together with all Acts amendatory thereof and supple- 
mental thereto and all Acts in conflict herewith are hereby re- 
pealed. Nothing herein shall be construed as affecting the pro- 
visions of the Act of June 16, 1913, establishing a State Mining 
Bureau. Id. 

The Waste Act. 

An Act prohibiting the unnecessary wasting of natural gas 
into the atmosphere; 



; ">88 MORRISON'S OIL RIGHTS 

Providing for the capping or otherwise closing of wells from 
which natural gas flows; 

And providing penalties for violating the provisions of this 
Act. 

Waste of Gas Prohibited. 

Sec. 1. All persons, firms, corporations and associations are 
hereby prohibited from willfully permitting any natural gas 
wastefully to escape into the atmosphere. Act March 25, 1911, 
p. 499. 

Gas Well to Be Plugged. 

Sec. 2. All persons, firms, corporations or associations dig- 
ging, drilling, excavating, constructing or owning or controlling 
any well from which natural gas flows shall upon the abandon- 
ment of such well, cap or otherwise close the mouth of or en- 
trance to the same in such a manner as to prevent the unneces- 
sary or wasteful escape into the atmosphere of such natural gas. 
And no person, firm, corporation or association owning or con- 
trolling land in which such well or wells are situated shall 
wilfully permit natural gas flowing from such well or wells, 
wastefully or unnecessarily to escape into the atmosphere. Id. 

Penalty for Violation. 

Sec. 3. Any person, firm, corporation or association who shall 
wilfully violate any of the provisions of this Act shall be deemed 
guilty of a misdemeanor, and upon conviction thereof shall be 
punished by a fine of not more than one thousand dollars or by 
imprisonment in the county jail for not more than one year, or 
by both such .fine and imprisonment. Id. 

Enlarging Crime by Definition. 

Sec. 4. For the purposes of this Act each day during which 
natural gas shall be wilfully allowed wastefully or unneeessarilv 
to escape into the atmosphere shall be deemed a separate and 
distinct violation of this Act. Id. 



STATE STATUTES 589 

COLORADO. 



Title. 



An Act relating to the production, purity, sale, and inspection 
of kerosene, gasoline, and all other fluid substances produced in 
whole or in part from petroleum, paint, varnish, filler, stain, 
linseed oil, turpentine and all other similar substances; 

Establishing the office of State inspector of oil with officers, 
assistants, and powers to enforce the provisions of this Act ; 

And repealing all Acts and parts of Acts in conflict here- 
with. Approved April 13, 1915. Act of 1915, p. 367. 

The first twenty-seven sections relate wholly to inspection of 
the several substances mentioned in the title. 

Bore Hole Through Coal. Notice to State Inspector. 

Sec. 28. It shall be the duty of the owner, owners, or person 
in charge of any bore hole which shall penetrate any workable 
coal seam or any accessible or inaccessible coal mine excavation, 
to notify the State oil inspector of the location of such bore 
hole by designating the particular five-acre subdivision of the 
land section on which such bore hole is situated, and the depth 
and thickness of each and every workable coal seam or accessible 
or inaccessible coal mine excaA^ation penetrated by such bore 
hole, and on receipt of such notification the State oil inspector 
shall at once notify the State Coal mine inspector. 

Waste of Gas or Oil. 

Sec. 29. It shall be unlawful for any person or corporation 
having possession or control of any natural gas or oil well, 
whether as contractor, owner, lessee, agent or manager, to allow 
or permit the flow of gas or oil, from any such well, to escape 
into the open air, but shall use due diligence to confine such gas 
or oil in such well or pipes or other safe and proper receptacles, 
or shall put the same to some beneficial use. 

Duty to Plug, Abandoned Well. 

Sec. 30. Whenever any well shall have been sunk for the pur- 



590 MORferSGN'S OIL RIGHTS 

pose of obtaining natural gas or oil, or exploring for the same, 
and shall be abandoned or cease to be operated for utilizing the 
flow of gas or oil therefrom, it shall be the duty of any person 
or corporation having custody or control of such well at the time 
of such abandonment, and also of the owner or owners of the 
land whereon such well is situated, to properly and securely 
stop and plug the same, in the following manner, to wit : 

There shall be placed in such well, above and below each and 
every water bearing formation which shall have been encoun- 
tered, a plug of seasoned wood, the diameter of which shall be 
not less than one-half inch smaller than the hole of such well 
where it is to be plugged, such plugs to be not less than five feet 
in length. The plug which shall be placed below such water 
bearing formation shall be properly anchored by ordinary meth- 
ods, and the plug which shall be placed above such water bearing 
formation shall be anchored in like manner, and the hole im- 
mediately above such plug shall be filled for a distance of not 
less than three feet with finely broken sand, gravel or stone. 

A ping of seasoned wood, or other wood obtainable in the 
vicinity of such well, and not less than five feet long, and of the 
diameter of the hole, shall be placed in the top of such well, in 
order to prevent the entrance of surface water. 

In the event that for any reason any well or wells shall cease 
to be operated for the utilization of oil or gas, and it is the in- 
tention of the owners or persons having charge of such well or 
wells to reopen them at some future time for the utilization of 
the said oil or gas, the provisions of this Act relating to the 
plugging of wells shall be inoperative, except that it shall be 
imperative upon the owners or persons having charge and con- 
trol of said well or wells, to adopt such measures as will prevent 
the oil or gas escaping into the open air until such time as the 
said well or wells are to be operated and the oil or gas put to 
some beneficial use. 

Sworn Report of Plugged Well. 

Sec. 31. Whenever any person, persons or corporations have 
abandoned or ceased operating any well or wells, as set forth 
in the immediately preceding section of this Act, such person, 



STATE , STATUTES 59 1 

persons or corporation shall file with the county clerk of the 
comity in which such well or wells are located, a sworn statement 
setting out the manner in which such well or wells have been 
plugged, and the date that same were plugged, together with the 
Location of such well or wells; said location to be considered 
sufficient when shown as being in a specified five-acre subdivi- 
sion of a designated land section, when the location shall be 
upon surveyed lands. When upon unsurveyed lands, the lo- 
cation must be shown on a map of the land section in which it 
may be situated, with proper metes and bounds to identify it. 
The said statement to be sworn to by at least two persons who 
shall have assisted in the actual work of plugging of said well 
or wells. 

Bore Hole Near Coal Mine. 

Sec. 32. No bore hole penetrating a gas-bearing or oil-bearing 
formation shall be located within two hundred feet of a shaft, or 
entrance, to a coal mine not definitely abandoned or sealed; nor 
shall such bore hole be located within one hundred feet of any 
mine shaft house, mine boiler house, mine engine house, or mine 
fan ; and the location of any proposed bore hole must insure that 
when drilled it will be at least fifteen feet from any mine haul- 



Casing to Shut off Water. 

Sec. 33. Any bore hole penetrating any workable seam of coal 
shall be cased by the owner of such bore hole with a suitable 
easing, conductor or drive pipe, so as to shut off all surface 
water from entering said workable coal seam. 

Protection of Coal Seam. 

Sec. 34. When bore holes for gas or oil are drilled in the coal 
measures and pass through workable seams, if gas or oil is en- 
countered in such bore hole, the coal seams or worked out coal 
seams shall be sufficiently protected by casing so that the gas 
or oil shall not come in contact with the coal seams or enter the 
excavations of worked out seams. 



.">92 MORRISON'S OIL RIGHTS 

Exclusion of Water. 

Sec. 35. When water-bearing formation is encountered in the 
drilling of any bore hole for natural gas or oil, casing shall be 
set upon the next formation encountered which is of such a 
nature that it will sustain the casing, and exclude all water from 
the lower bore hole. 

Log of Well. 

Sec. 36. When a bore hole has been drilled and completed, 
and placed in operation for the utilization of natural gas or oil, 
the owner of such well shall file with the inspector a statement 
of the total depth of the hole, the sizes and lengths of casings 
used and remaining in the hole, the depth and thickness of coal 
seams penetrated and whether oil, gas or water was obtained. 

The information thus given to the inspector shall not be 
deemed to be public record, and shall be given out by the in- 
spector or his deputies, only upon the written consent of the 
person, persons or corporation rendering such statement. 

Notification of Abandonment. 

Sec. 37. When any oil or gas well is to be abandoned, the 
owner shall notify the inspector in writing, of such intent to 
abandon and shall proceed with the plugging as provided herein. 

Certain Sections Limited. 

Sec. 38. Sections 28, 32, 33, 34, 35 and 36 apply only to wells 
or bore holes which may be drilled through workable coal seams. 

Annual Report of Inspector. 

Sec. 39. On the first Monday of February of each year, the 
State inspector shall make and deliver to the governor of the 
State an annual report of the inspections made by him or his 
deputies for the preceding year. 

Power to Remove Inspector. 

Sec. 40. The governor shall have the power to remove from 



STATE STATUTES 59o 

office any inspector who is incompetent or unfaithful in the dis- 
charge of his official duty, or who having knowledge of the vio- 
lation of any of the provisions of this Act, shall neglect or refuse 
to prosecute the offender. 

Official Duty to Enforce. 

Sec. 41. It shall be the duty of the district attorneys, in their 
districts, and the attorney general, in cases where the district 
attorney refuses to act, to enforce the provisions of this Act by 
appropriate actions in Courts of competent jurisdiction. 

Appointment of State Inspector. 

Sec. 42. The governor shall appoint a skilled and suitable 
person who has been qualified by the State civil service examina- 
tion and who is not interested in the manufacture or dealing in 
oils, as State inspector of oils. 

Oath of Inspector. 

Sec. 43. Any person, appointed State inspector of oils or 
deputy inspector of oils, shall before entering on the duties 
of the office, take oath or affirmation as prescribed by the con- 
stitution of, the State and shall file the same in the office of the 
Secretary of State. 

Bond. 

The State inspector shall execute a bond to the State of Colo- 
rado in the sum of ten thousand dollars which surety shall be 
approved by the Secretary of State, conditioned upon the faith- 
ful performance of the duties imposed upon him in the Act, and 
the bond shall be for the use of all persons in any way injured 
or aggrieved by the Acts or neglects of said inspectors. 

The deputy inspectors shall execute a bond to the State of 
Colorado in the sum of five thousand dollars, which surety shall 
be approved by the judge of the District Court in the county 
where the said deputy is located, and bond shall also be for the 
use of all persons in any way aggrieved or injured by the acts of 
such deputy inspector. 
M. O. K.— 38. 



594 MORRISON'S OJL RIGHTS 

Deputies. Analysis of Samples. 

Section 44. There shall be three deputy oil inspectors, one of 
whom shall be the professor of mechanical engineering of the 
University of Colorado, and he shall have the supervision and 
charge of the laboratory and all instruments and appliances 
therein. It shall be the sole duty of this deputy and his qualified 
assistants to make all routine analyses of all samples submitted 
by the chief oil inspector, and to give such results in writing as 
may be necessary for the proper carrying out of the require- 
ments of the Act. He shall employ qualified assistants at his 
own expense. 

In cases where samples for tests and analysis which do not 
come under the provisions of this Act are submitted by either 
the State oil inspector or by private parties, a fee may be 
charged, to cover the laboratory expenses and pay for the time 
of the deputy and his assistants. 

The appointment of other deputies shall be made by the gov- 
ernor. Amendment of 1919, p. 562. 

Sections 45, 46, and 47 make an appropriation, provide penal- 
ties and repeal prior Acts. 

REQUIREMENTS AS TO PIPE LINE CORPORATIONS. 

Additional Statements in Certificate for Pipe Line Companies. 
Right of Way. 

Whenever any three or more persons associate under the pro- 
visions of said chapter XIX, of the General Statutes of the State 
of Colorado, to form a company, for the purpose of constructing 
a pipe line for the convej^ance of gas, water or oil, they shall in 
their certificate, in addition to the matters required in section 2 
(R. S. § 847) of said chapter XIX, specify as follows: The 
places from and to which it is intended to construct the proposed 
line or lines, and any pipe line company formed under the provi- 
sions of said chapter XIX, shall have the right of way over the 
line or lines named in the certificate, and shall also have the right 
to convey gas, water or oil, by said lines as stated in -such certi- 
ficate, through lands of the State of Colorado, and lands of in- 



STATE STATUTES 595 

dividual* with the right to erect thereon pump station, storage 
tanks and other buildings necessary for such business, a) id it 
.any such corporation shall be unable to agree with such in- 
dividuals owning any of such lands for the purchase of any real 
estate required for the purpose of any such corporation or com- 
pany, or the transaction of the business of the same, or for rigid 
of way, or any other lawful purpose connected with or necessary 
to the operation of said company, such corporation may acquire 
such title in manner provided by law. R. S. § 999, Act 1891, 
p. 94. 

Pipe Line Companies. Right of Way. 

Any foreign or domestic corporation organized or chartered for 
the purpose, among other things, of conducting or maintainiug 
a pipe line for the transmission of power, water, air, or gas for 
hire to any mine or mining claim, or manufacturing, milling, 
mining, or public purpose, shall have the right of way for the 
construction, operation and maintenance of such pipe, line or 
pipe lines, for such purposes, through any lands, without the 
consent of the owner thereof, where such right of way is neces- 
sary for the purpose for which said pipe line shall be used. R. 
S. § 2436, Act 1907, p. 282. 

Pipe Line Company File Map of Course. 

Any such pipe line corporation, desiring to avail itself of the 
benefit of this Act, shall file with the county clerk and recorder 
of the county or counties in which it is proposed to operate, a 
map or survey of its proposed line, for which it desires a right 
of way, together with a statement showing the route of the pro- 
posed pipe line, and the patented or unpatented mining claims 
or other property through which it is proposed to construct the 
same, and may file supplementary maps and surveys upon any 
lawful change of its proposed line. R. S. § 2446, Act 1907, p. 
282. 

Companies Furnish Power on Payment of Fees. 
Any such pipe line corporation, or electric power transmis- 



596 MORRISON'S OIL RIGHTS 

sion, corporation or corporations shall, subject to its or their 
reasonable regulations, furnish to the owners of mining proper- 
ties power from said pipe lines or electric power transmission 
lines upon payment to it or them at the rates established and 
fixed by such corporation or corporations. R. S. § 2450, Act 
1907, p. 282. 

There are no special provisions for the incorporation of oil or 
natural gas companies. They are covered of course by the 
sweeping sections providing for the incorporation of mining, 
companies or companies organized for any lawful purpose. 

ILLINOIS. 

Record of Forfeiture of Lease. 

Seel. When any lease on land heretofore or hereafter taken 
for the purpose of prospecting for oil or natural gas or operating 
oil or gas wells upon lands so leased, shall become forfeited by 
the terms of said lease or the acts of the lessee, it shall be the 
duty of the lessee, his, her or their successors or assigns within 
sixty days -from the date this Act shall take effect, if such for- 
feiture take effect prior thereto and within sixty days from day 
of forfeiture of any and all other leases, to have such lease or 
leases released of record in the county where such land is situ- 
ated, without any cost to the owner or owners of the land, and 
failure so to do shall constitute a misdemeanor and shall subject 
the offender to a fine of not more than two hundred dollars. 
Approved May 27, 1907. Acts p. 400. Ann. St. § 7552. 

Costs on Action to Forfeit Lease. 

Sec. 2. Whenever the lessee of any oil or natural gas lands or 
the person, firm, company or corporation, only holding or having 
control of any such lease shall allow the same to become for- 
feited, or by his, her or their Acts shall forfeit the same, and 
shall refuse, fail or neglect to cause the same to be released of 
record, the lessor or owner of said lands may begin a civil action 
to compel said party to release the same of record and upon 
judgment being rendered decreeing said lease forfeited and di- 



STATE STATUTES 597 

recting the release, the said lessee, or his assigns, shall be de- 
creed to pay all costs by such action, including a reasonable 
attorney fee to be taxed as costs. Id. § 7553. 

Distance of Well from, Adits and Air Shafts. 

Sec. 1. No oil or gas well shall be drilled hereafter nearer 
than 250 feet to an opening to a mine used as a means of ingress 
or egress for the persons employed therein or which is used as an 
air shaft. Approved June 7, 1911. Acts, p. 426 amending Act 
of 1905. Ann. St. § 7545. 

Drill Hole penetrating Coal Vein. 

Sec. 2. It shall be the duty of any person, firm or corporation 
having the custody or control of any well drilled for gas or oil 
and of the owner of the land in which such- well is drilled, 
when the drill hole penetrates a coal seam, to file in the office of 
the recorder of the county in which said oil or gas well is 
drilled, and in the office of the State Mining Board within 
fifteen clays after completing said well, a statement and map giv- 
ing the location and depth of every well so drilled and the 
county recorder shall file and enter and index same in the rec- 
ords of his office relating to the titles to real property. Id. 
§ 7546. 

Directions for Plugging Well. 

Sec. 3. Before the casing shall be drawn from any well for the 
purpose of abandonment thereof, which has been drilled into 
any gas or oil-bearing rock, it shall be the duty of any person, 
firm or corporation having the custody or control of such well at 
the time of such abandonment, and also the owner or owners ot 
the land wherein such well is situated, to properly and securely 
stop and plug the same in the following manner : Such hole first 
be solidly filled from the bottom thereof to a point at least twenty 
feet above such gas or oil-bearing rock with sand, gravel or 
pulverized rock, immediately on the top of which filling shall 
be seated a dry wood plug not less than two feet in length, hav- 
ing a diameter of not less than one-fourth of an inch less than 



598 MORRISONS OIL RIGHTS 

the inside diameter of the easing- in such well. And above sueh 
wooden plug sueh well shall be solidly tilled for at least twenty- 
five feet with the above-mentioned filling material, immediately 
above whieh shall be seated another wood plug of the same kind 
and size as above provided, and such well shall again be solidly 
tilled for at least twenty-five feet above such plug with such 
filling material. After the casing has been drawn from such well 
there shall immediately be seated at the point where such casing 
was seated a cast-iron ball or tampered wood plug at least two 
feet in length, the diameter of which ball or the top of which 
wood plug shall be greater than that of the hole below the point 
where such casing was seated, and above such ball or plug such 
well shall be solidly filled to top of well with the aforesaid ma- 
terial. Id, § 7547. 

Proof of Plugging. 

Sec. 4. The person, firm or corporation owning or having con- 
trol or custody of any such well, or the land in which any such 
well is situated, shall file or cause to be_filed in the office of the 
recorder of the county in which any such well is located, within 
fifteen days after the same has been plugged, as provided in sec- 
tion 3, the affidavit of at least two persons who were present dur- 
ing the plugging of such well, which affidavit shall be recorded 
in the record books in the office of the recorder of such county, 
and shall set out in detail the manner in which such well was 
plugged and the depth of each such wood plugs and iron bail 
below the surface of the ground, and the record of such affidavit 
shall be prima facie evidence in any court of a complianee with 
the provisions of this Act. Id. § 7548. 

Casing Out the Water. 

Sec. 5. It shall be the duty of any person, firm or corporation 
sinking a well in any oil or gas-bearing rock, or having sunk 
sueh well and maintaining the same, to case off and keep cased 
off all fresh water from sueh well. Id, S 7549. 



STATE STATUTES 599 

Penalties for Failure to Plug or Record. 

Sec. 6. Any person, firm or corporation violating the provi- 
sions of section 1 or failing- to comply with the provisions of 
section 2 of this Act, or who shall fail or refuse to plug a well in 
the time and manner provided in section 3 of this Act, or shall 
fail or neglect to secure and file in the proper recorder's office 
the affidavit provided for and required in section 4 of this Act, 
or shall fail and neglect to properly case off fresh water from 
such well and keep the same cased oft' while said well is main- 
tained, as provided in section 5 of this Act, shall be liable to a 
penalty of one hundred dollars ($100) for each and every vio- 
lation thereof; and the further sum of one hundred dollars 
($100) for each ten days during which such violation shall con- 
tinue, and all such penalties shall be recoverable in a civil ac- 
tion brought in any court of competent jurisdiction in any 
county in which said violation occurred, brought in the name 
of the State of Illinois on the relation of such county, and for 
the use and benefit of such county, and in all such cases; if 
there be recovery by the State, it shall recover in addition to 
such penalties a reasonable attorney's fee. Id. § 7550. 

Section 7 is the emergency clause. 



INDIANA. 

Under the general incorporation laws of Indiana, companies 
may be organized for the purpose of sinking and operating oil 
and gas wells and of selling the products of such wells. Burns 
Ann. Stat. sees. 4287, 4304. And by sec. 5134 "mining" is de 
fined to cover and include the sinking, drilling, boring and oper- 
ating wells for petroleum and natural gas and by section 5137 
the capital stock of any such company must not exceed $2,000.- 
000. 

Natural Gas Supervisor, Office Created and Duties Declared. 

Sec. 1. That the office of natural gas supervisor is hereby estab- 
lished, and within thirty days after the taking eftcct of this 



bOO MORRISON'S OIL RIGHTS 

Act the State geologist of Indiana shall appoint a skilled and 
suitable person, who shall have a practical knowledge of geol- 
ogy and natural gas, and who is not directly or indirectly in- 
terested in piping or selling natural gas, as natural gas super- 
visor of the State of Indiana. Such supervisor shall serve for 
a term of four years, and until his successor is appointed and 
qualified, and in case a vacancy occurs in the office of natural gas 
supervisor from any cause, the State geologist shall fill such 
vacancy by appointment as herein prescribed: Provided, how- 
ever. The State geologist shall have power to remove such super- 
visor at any time for violation or neglect of duty. Such 
supervisor shall receive an annual salary of twelve hundred dol- 
lars, and the further sum of six hundred dollars for traveling 
and other expenses, and an annual appropriation of eighteen 
hundred dollars is hereby made out of any moneys in the State 
treasury not otherwise appropriated for the salary and expenses 
of such supervisor. The State geologist shall issue to such natural 
gas supervisor a certificate of appointment, and said supervisor 
shall, within ten days thereafter, make and execute a bond in the 
sum of one thousand dollars, payable to the State of Indiana, 
with his oath of office endorsed thereon, which bond shall be for 
the faithful performance of duty, and shall be approved by and 
filed with the Secretary of State. Such supervisor, when he 
has qualified according to law, shall devote all his time to the 
business of his office, and he shall work at all times under the 
direction of the State geologist. He shall make personal in- 
spection of all the gas wells of the State, so far as practicable, 
and shall see that every precaution is taken to insure the health 
and safety of workmen engaged in opening gas wells and laying 
mains and pipes, and of those who, in any manner, use gas for 
mechanical, manufacturing, domestic or other purposes. He 
shall see that all the provisions of law pertaining to the drilling 
of wells and the piping and consumption of natural gas are 
faithfully carried out, and that the penalties of law are strictly 
enforced against any person or persons who violate the same, 
and promptly report all violations of law to the attorney-gen- 
eral of the State. He shall collect and tabulate in his annual 
report to the State geologist, which shall be made on the second 



STATE STATUTES 601 

Monday in January of each year, and published in the report 
of the State geologist, the following facts: The number of gas 
wells, with location; a record of the geological strata passed 
through in drilling wells, depth at which salt water is reached 
in the various wells, and the height to which it rises; the volume 
of gas produced by each well, so far as it can be ascertained, 
and also the initial or rock pressure of the same; the increase 
or decrease in pressure of the various wells, so far as it can be 
ascertained, and also the increase or decrease in volume of gas 
produced ; the number of miles of mains laid for the transporta- 
tion of gas, and capacity and cost of the same; the amount of 
capital invested in the gas industry, and the number of persons 
employed in the same; the cost of gas as fuel at the various 
points at which it is used; the amount of capital invested in 
manufactories located on account of natural gas, and the num- 
ber of the same, together with the amount and kind of products 
and number of employees, and such other facts and informa- 
tion as the State geologist may require. 1891 p. 379. Burns 
Ann. Stat. sec. 9056. 

Inspection Duties. 

Sec. 2. It shall be the duty of the natural gas supervisor to 
inspect all natural gas pipe lines in this State, at least once in 
each year, and as often as may be necessary, or whenever he may 
be directed by the State geologist; and he shall have the power 
to condemn any pipes or portions of lines that he may deem 
unsafe or dangerous to life or property. And any person or 
persons using, or causing to be used, any pipe line or portions 
thereof after the same has been condemned, shall be guilty of 
a misdemeanor, and upon conviction shall be fined in any court 
I laving jurisdiction of misdemeanors, in any sum not exceeding 
one hundred dollars; and any person or persons in this State 
owning natural gas wells or natural gas pipe lines, or who con- 
trols the same, who refuses to allow the same to be inspected 
by the natural gas supervisor, upon conviction shall be fined 
in any sum not exceeding fifty dollars: Provided, farther, 
That whenever any responsible person shall file with such gas 
supervisor an affidavit charging the owner or owners of such 



602 MOKLUsoN's Dili EIGHTS 

g'as plant or wells, or any person using the same, or their em- 
ployees, with the violation of any of the laws regulating the "use 
of natural gas, and particularly specifying the violation com- 
plained of, it shall be the duty of such supervisor to examine and 
inquire into the alleged violation of the law as set forth in the 
affidavit, and if he finds the facts as charged it shall be his duty 
to see that the law is complied with. Burns Ann. St. sec. 9057. 

Repairs of Leaks. 

Sec. 1. That it shall be and is hereby made the duty of the 
natural gas supervisor of the State of Indiana, upon the dis- 
covery of any leak in any pipe line for transportation of natural 
gas, or in any machinery, apparatus, appliance or device used 
in the regulation or distribution thereof, to forthwith notify, 
in writing, the owner or superintendent of said pipe line, ma- 
chinery, apparatus, appliance or device, to have the same re- 
paired within two days from the time of receipt of said notice. 
In case such leak has not been repaired within two days from 
the time of receiving such notice it shall be the duty of said 
natural gas supervisor to make such repairs as may in his judg- 
ment be necessary to stop said leak ; and such natural gas super- 
visor shall have a lien upon said pipe line and all wells with 
which the same may be connected, for the cost of making such 
repairs, for the enforcement of which, with all costs of suit, 
and a reasonable attorney's fee, an action may be maintained 
by him in any Court of competent jurisdiction; and the judg- 
ment so obtained shall be collectible without relief from valua- 
tion or appraisement laws of the State. In case of any pipe 
line, machinery, apparatus, appliance or device, owned by a 
corporation, partnership, or by a non-resident of or absentee 
from the State of Indiana, the notice herein provided may be 
served upon any person in charge of such pipe line. Act of 1899, 
p. 83. Burns Ann. St. sec. 9058. 

Test of Pipe Pressure. 

Sec. 1. That any person or persons, firm, company or corpo 
ration, engaged in drilling for, piping, transporting, using oi 



STATE STATUTES 60-J 

selling natural gas, may transport or conduct the same through 
sound wrought or east-iron castings and pipes tested to at least 
four hundred pounds' pressure to the square inch: Provided, 
Such gas shall not be transported through pipes at a pressure ex- 
ceeding three hundred pounds per square inch : Provided, That 
the provisions of this Act shall not affect the costs in any pend- 
ing litigation. Act of 190o, p. 110. Burns Ann. St. sec. 9060. 

Fines. Shooting Well. 

Sec. 2. Any person or persons, firm, company or corporation 
violating any of the provisions of this Act shall be fined in any 
sum not less than one thousand dollars or more than ten thou- 
sand dollars, and may be enjoined from conveying and trans- 
porting natural gas through pipes otherwise than in this Act 
provided: Provided, That nothing in this section shall operate 
to prevent the use of nitro-giycerine or other explosives for 
shooting any well or wells from which the gas is procured. 
Burns Ann. St, sec. 9061. 

Two days' Limit to Confine Gas. 

That it shall be unlawful for any person, firm or corporation 
having possession or control of any natural gas or oil well, 
whether as a contractor, owner, lessee, agent or manager, to 
allow or permit the flow of gas or oil from any such well to es- 
cape into the open air, without being confined within such well 
or proper pipes, or other safe receptacle for a longer period than 
two (2) days next after gas or oil shall have been struck in 
such well. And thereafter all such gas or oil shall be safely 
and securely confined in such well, pipes or other safe and prop- 
er receptacles. Any person, firm or corporation violating any of 
the provisions of this section shall be fined in any sum not less 
than fifty dollars, nor more than two hundred dollars, and for 
i\\iy second or subsequent violation of this section he shall be 
lined in any sum not less than two hundred dollars, nor more 
than five hundred dollars. Act of 1913, p. 66. 



604 MORRISON'S OIL RIGHTS 

Plugging Well by Stranger. 

Whenever any person or corporation in possession or control 
of any well in which natural gas or oil has been found shall 
fail to comply with the provisions of this Act^ any person or 
corporation lawfully in possession of lands adjacent to or in the 
vicinity or neighborhood of such well may enter upon the lands 
upon which such well is situate and take possession of such well 
from which gas or oil is allowed to escape in violation of the 
provisions of section 1 of this Act and pack and tube such well 
and shut in and secure the flow of gas or oil, and maintain a 
civil action in any Court of competent jurisdiction in this State 
against the owner, lessee, agent or manager of said well, and 
each of them jointly and severally to recover the cost and ex- 
pense of such tubing and packing, together with attorney's fees 
and costs of suit. This shall be in addition to the penalties pro- 
vided by section 3 of this Act. Burns Ann. St. sec. 9063. 1 

Recovery of Expenses Incurred. 

Whenever any person or corporation shall abandon or cease 
to operate any natural gas or oil well, and shall fail to comply 
with the provisions of section 2 of this Act, any person or cor- 
poration lawfully in possession of lands adjacent to or in the 
vicinity or neighborhood of such well may enter upon the lands 
upon which such well is situated and take possession of such 
well, and plug and fill the same in the manner provided by 
section 2 of this Act, and may maintain a civil action in any 
Court of competent jurisdiction of this State agrinst the per- 
son, persons or corporations so failing, jointly and severally, 
to recover the costs and expense of such plugging and filling, 
together with attorney's fees and costs of suit. This shall be 
in addition to the penalties provided by section 3 of this Act. 
Burns Ann. St. § 9064. 

Interference with Gas Connections. 

It is hereby declared to be unlawful for any person, in any 

i The section 3 referred to in this and the next section is in the Act of 
1893, p. 300. 



STATE STATUTES 605 

maimer whatever, to change, extend or alter, or cause to be 
changed, extended or altered any service or other pipe or at- 
tachment of any kind connecting or through which natural or 
artificial gas is furnished from the gas mains or pipes of any 
person, company or corporation without first procuring from 
said person, company or corporation, written permission to 
make such change, extension or alteration. Act of 1891, p. 382, 
Bums § 2705. 

Oas Connections without Consent. 

It is hereby declared to be unlawful for any person to make, 
or cause to be made, any connection or reconnection, with the 
gas mains or service pipes of any person, company, or corpora- 
tion, furnishing to consumers natural or artificial gas, or turn 
on or off, or in any maimer interfere with any valve or stop- 
cock, or other appliances belonging to such person, company or 
corporation, and' connected with its service or other pipes, or 
to enlarge the orifice of mixers, or to use natural gas for heat- 
ing purposes except through mixers, without first procuring 
from such person, company or corporation a written permit to 
turn on or off such stop-cock or valve, or to make such connec- 
tions or reconnection, or to enlarge the orifice of mixers, or to 
use gas for heating without mixers, or to interfere with the 
valves, stop-cocks, or other appliances of such person, company 
or corporation, as the case may be. Burns § 2706. 

Refusal to Return Gas Mixers. 

It is hereby declared to be unlawful for any person or per- 
sons to whom any mixer or mixers or other appliances may be 
or may have been loaned or rented by any person, company 
or corporation for the purpose of furnishing gas through the 
same, to retain possession, or to refuse to deliver such mixer- 
or mixers, or other appliances to the person, company or cor- 
poration entitled to the possession of the same, after such per- 
son, company or corporation shall have been entitled to the 
possession of the same, or to sell, loan or in any manner dis- 
pose of the same to any person or persons, other than said per- 



006 MORRISON'S OIL RIGHTS 

son, company or corporation entitled to the possession of the 
same. Burns § 2707. 

Setting Fire to Escaping Gas. 

It is hereby declared to be unlawful for any person or persons 
to set on fire any gas escaping from wells, broken or leaking 
mains, pipes, valves, or other appliances, used by any person, 
company or corporation in conveying gas to consumers, or to 
interfere in any manner with the wells, pipes, mains, gate boxes, 
valves, stop-cocks or other appliances, machinery or property 
of any person, company or corporation engaged in furnishing 
gas to consumers, unless employed by or acting under the au- 
thority and direction of such person, company or corporation 
engaged in furnishing gas to consumers. Burns § 2708. 

Penalty. 

Any person violating any provision of this Act shall, upon 
conviction, be fined in any sum not less than five dollars nor 
more than one hundred dollars for such offense. Burns § 2709. 

Flambeau Lights Forbidden. 

The use of natural gas for illuminating purposes, in what are 
known as flambeau lights, is a wasteful and extravagant use 
thereof, and is dangerous to the public good, and it shall there- 
fore be unlawful for any company, corporation or person, for 
hire, pay or otherwise, to use natural gas for illuminating pur- 
poses in what are known as flambeau lights in cities, towns, high- 
ways, or elsewhere: Provided, That nothing herein contained 
*hall be construed as to prohibit any such company, corporation 
or person from the necessary use of such gas in what are known 
as "jumbo" burners enclosed in glass globes, or lamps or by the 
use of other burners of similar character so enclosed, as will con- 
sume no more gas than said "jumbo" burners. Burns § 2710, sec. 
1, Act 1891, p. 55. 



STATE STATUTES 60 Y 

Hours for Jumbo Burners. 

All gas lights in said "jumbo" burners and glass globes, or 
Inmps used in all streets and public highways shall be turned 
off not later than 8 o'clock in the morning of each day such lights 
or burner is used, and the same shall not be lighted between the 
hours of 8 o'clock a. m. and 5 o'clock p. m. Burns § 2711. Sec. 
2 Id. 

Penalty. 

Any one violating any of the provisions of section one (1) 
of this Act, shall be deemed guilty of a misdemeanor and upon 
conviction shall be fined in any sum not exceeding twenty-five 
dollars, and for a second .offence may be fined in any sum not 
exceeding two hundred dollars. Sec. 3. Id. Burns § 2712. 

Operator to Furnish Meters Open for Inspection. 

That every person, company or corporation now engaged or 
hereafter engaging in the business of furnishing natural or arti- 
ficial gas for heating, illuminating or other purposes, to be used 
and paid for by patrons by meter measure, shall furnish to each 
and every patron a meter properly tested and in good order, 
and shall arrange such meters so that the patron can, at any 
time, see the meter dial and ascertain how much gas he is con- 
suming, and how much he is liable to pay for. Sec. 1. Acts of 
1901, p. 97. Burns § 2713. 

Excess Charges Prohibited. 

It shall be unlawful for any person, company or corporation 
engaged in furnishing gas to consumers, to be paid for by meter 
measure, to charge or receive, from any patron or consumer, 
pay for more gas than the meter furnished by such person, 
company or corporation shall indicate has been used by such 
consumer at the time to which payment is made and received. 
Sec. 2, Id. Burns § 2714. 



60b MORRISON'S OIL RIGHTS 

Penalty. 

Any person, company or corporation violating any of the pro- 
visions of this Act shall be deemed guilty of a misdemeanor and 
upon conviction thereof shall be fined in any sum not less than 
ten dollars and not more than one hundred dollars for each of- 
fence. Sec. 3, Id. Burns § 2715. 

Penalty for False Gas Meter. 

Whoever knowingly constructs, or uses or furnishes to gas 
consumers to be used, any false meter provided for measuring 
and registering the quantity of gas consumed by any person 
under a contract with any gas company, shall, on conviction, be 
fined not less than ten dollars nor more than one hundred dol- 
lars. Burns § 2608. 

Powers of Oil, Gas and Pipe Line Companies. 

That whenever any company, corporation or voluntary asso- 
ciation incorporated under the laws of the State of Indiana, or 
which may hereafter be incorporated thereunder for the pur- 
pose of drilling and mining for petroleum or natural gas, or 
otherwise acquiring gas or petroleum wells and the products 
thereof, and to furnish the same to its patrons for use within 
this State, and by manufacture to convert the same into gas for 
fuel and illuminating purposes, and other articles of commerce, 
shall desire to dig trenches and lay pipes for the purpose of 
conducting gas to its patrons within this State or conducting 
gas from its wells, or wells leased by it, or from its manufactory 
to any point within this State, such company, corporations or 
voluntary associations shall possess the powers, be subject to 
the liabilities and restrictions expressed in the following: 

First. To cause such examination and surveys as may be 
necessary to the selection of the most advantageous routes for 
the said trenches and pipes, and for such purposes, by their 
officers, agents and servants, to enter upon the lands and waters 
of any person; but subject to responsibility for any damages 
which they shall do thereto. 

Second. To receive, hold and take such voluntary grants and 



STATE STATUTES 609 

donations of real estate and other property as shall be made to 
it to aid in the construction, maintenance and accommodation 
of such trenches and pipes, but the real estate thus received by 
voluntary grants shall be held and used for the purposes of 
such grants only. 

Third. To purchase, and by voluntary grants and donations, 
receive and take, and by its officers, engineers, surveyors and 
agents enter and acquire an easement in and upon and take 
possession of and use all such lands and real estate and other 
property as may be necessary for the construction and mainte- 
nance of the said trenches and pipes, and other accommodations 
necessary to accomplish the objects for which the company, cor- 
poration or voluntary association is created; but not until the 
compensation to be made therefor is agreed upon by the parties, 
or ascertained as hereinafter prescribed shall have been paid 
to the owner or owners thereof or deposited as hereinafter di- 
rected, unless the consent of such owner be given to enter into 
possession. 

Fourth. To locate and lay out and construct its said trenches, 
not exceeding one rod in width for a single pipe line, and to 
construct the same; said trenches and pipe lines in all cases to 
be laid at such depth as not to interfere with the tillage of the 
soil, or the existing drainage, and the soil taken from said 
trenches shall be returned with the top soil on top, as originally 
found; said company, corporation or voluntary association to 
have the right to enter and go upon said right of way by its 
officers and agents, without hindrance, for the purpose of dig- 
ging said trenches and laying said pipe, inspecting, operating 
and repairing the same. 

Fifth. To dig its trenches, to lay its pipe lines over, across or 
under any stream of water, water-course, road, highway or 
railroad, so as not to interfere with the free use of the same, 
which the route thereof shall intersect, in such manner as to 
of county commissioners of the proper county shall so direct, 
afford security for life or property. And whenever the board 
said trenches and pipe lines may be constructed and laid along 
the right of way of any road or highway, but in all cases where 
said trenches or pipe lines shall be laid across, upon or along 
M. 0. R.— 39 



610 MORRISON'S OIL RIGHTS 

any gravel road, road or highway thus intersected, said com- 
pany, corporation or voluntary association shall immediately, 
upon the laying of any such pipe, restore the same to its former 
state, or in a sufficient manner not to have unnecessarily im- 
paired its usefulness or injured its franchises. 

Sixth. To purchase or acquire easements in and upon lands, 
and it may change the line of its said trenches and pipe lines 
whenever a majority of the directors shall so determine. Act 
of 1889, p. 22, Burns § 5138. 

Right of Way for Pipe Line. 

Whenever any such company, corporation or voluntary as- 
sociation is unable to agree with the owner or owners about the 
purchase of any real estate in any county required for the con- 
struction of its trenches and the laying of the mains and con- 
necting pipes, it shall have the right to acquire an easement in 
and upon the same in the manner and by the special proceedings 
prescribed in this act. Burns, § 5139. 

Deposit Required. Procedure to Condemn. 

Such company, corporation or voluntary association is hereby 
authorized to enter upon any land for the purpose of examin- 
ing and surveying its line for trenches and pipe lines, and may 
acquire an easement in and upon so much thereof as may be 
deemed necessary for its said trenches, not exceeding one rod 
in width for any single pipe line. The company, corporation 
or voluntary association shall forthwith deposit with the clerk 
of the circuit or other Court of record in the county where the 
line lies, a description of the rights and interest intended to be 
appropriated, and an easement in such land, rights and inter- 
ests shall belong to such company, corporation or voluntary as- 
sociation to use for the purpose specified, by making or tender- 
ing payment as hereinafter provided. The company, corpora- 
tion or voluntary association may, by its directors, purchase any 
such lands, right of way or interest of the owner of such land, 
or in case the same is owned by a person insane or an infant, 
at a price to be agreed upon by the regularly constituted guar- 



STATE STATUTES 6H 

dian of said insane person or infant, if the same shall be ap- 
proved by the court in which the description aforesaid shall be 
filed, and on such agreement and approval the owner or guar- 
dian, as the case may be, shall convey the easement or right of 
way upon the said premises so purchased, to such company, cor- 
poration or voluntary association, and the deed when made shall 
be valid in law. If the company, corporation or voluntary asso- 
ciation shall not agree with the owner of the land "or with his 
guardian if the owner is incapable of contracting"' touching the 
damages sustained by such owner, such company, corporation, 
or voluntary association shall deliver to such owner or guardian 
within the county a copy of such instrument of appropriation. 
If the owner "or his guardian, in case such owner is incapable 
of contracting," be unknown or does not reside within the coun- 
ty, such company, corporation or voluntary association shall 
publish in some newspaper of general circulation in the county, 
for the term of three weeks, an advertisement reciting the sub- 
stance of such instrument of appropriation. Upon filing sue]] 
act of appropriation and the delivery of such copy or making 
of such publication, the Circuit Court or other Court of record 
in the county where the land lies, or any judge thereof in vaca- 
tion, upon the application of either party, shall appoint by war- 
rant three disinterested freeholders of said county to appraise 
the damages which the owner of the land may sustain by such 
appropriation. Such appraisers shall be duly sworn. They 
shall consider the injury which such owner may sustain by 
reason of such trenches and pipe lines, and shall forthwith re- 
turn their assessment of damages to the clerk of such Court, 
setting forth the value of the property taken or injury done 
to the property "which they shall assess to the owner or owners 
separately," to be by him filed and recorded. Thereupon said 
company, corporation or voluntary association shall pay to such 
clerk the amount thus assessed, or tender the same to the party 
in whose favor the damages are awarded or assessed. On mak- 
ing payment or tender thereof in the manner herein required, 
it shall be lawful for such company, corporation or voluntary 
association to hold the interest in said lands or material so ap- 
propriated for the uses aforesaid: Provided, First, That any 



(512 MORRISON'S OIL RIGHTS 

person aggrieved by the action or assessment of any appraisers 
appointed under this act may appeal therefrom to the Circuit 
Court of their county, under the same provisions and subject 
to the same restrictions as provided for in case of appeals from 
assessments under the laws of this State for the appropriation 
of real estate for rights of way of railroads, as provided by an 
act of the general assembly of the State of Indiana, in force 
May 6, 1853, and all acts amendatory thereof : And Provided, 
further, That nothing in this act contained shall in any manner 
abridge or impair the rights of incorporated towns and cities 
by their respective councils, boards of aldermen or boards of 
trustees to grant to such corporations or companies the privi- 
lege to use and occupy the streets and alleys of such cities and 
towns for the purpose of laying mains for conveying gas to their 
patrons. Burns § 5140. 

Contests between Conflicting Claimants. 

If there are diverse or conflicting claimants to the money or 
any part of it to be paid as compensation for the real estate 
taken, the Court may direct the money to be paid into said 
court by said company, corporation or voluntary association 
until it can determine who is entitled to the same, and shall 
direct to whom the same shall be paid, and may, in its discretion 
order a reference to ascertain the facts on which said determina- 
tion and order are to be made. Burns § 5141. 

Practice. Amendments. Unknown Parties. 

The Court shall appoint some competent attorney to appear 
for and protect the rights of any party in interest who is un- 
known and who has not appeared in the proceedings by an 
attorney or agent. The Court shall also have power at any 
time to amend any defect or informality in any of the special 
proceedings authorized by this Act as may be necessary, or to 
cause new parties to be added, and to direct such further notice 
to be given to any party in interest as it deems proper, and also 
to appoint other commissioners in the place of any who shall 



STATE STATUTES 613 

die or refuse or neglect or be unable to serve, or who may leave 
or be absent from the State. Burns § 5142. 

Proceedings De Novo. Limitations on Condemnor's Rights. 

At any time after an attempt to acquire title by appraise- 
ment of damages or otherwise, if it shall be found that the title 
thereby attempted to be acquired is defective, the company, 
corporation or voluntary association may proceed anew to ac- 
quire or perfect the same in the same manner as if no appraisal 
had been made : Provided, That the provisions of this Act shall 
not be construed to give to any person, corporation or associa- 
tion the right to enter upon lands and dig or prospect for na- 
tural gas or oil, or to take any lands for the purpose of digging 
or boring any wells, but it shall be construed to give the right 
to take the right of way for pipe lines only: And Provided, 
further, That no person or corporation shall have the right to 
condemn or take any lands, or lay their pipe lines within 
seventy-five yards of any dwelling or barn, unless the owner 
shall agree in writing that the same may be placed within such 
distance, except when the line of such pipes shall be along a 
public highway. Burns § 5143. 

Right of Way to Gas Companies. 

That whenever any corporation or voluntary association, or^ 
ganized under the laws of the State of Indiana, or which may 
hereafter be incorporated thereunder for the purpose of manu- 
facturing, piping, distributing or selling artificial or other gas 
for heat, light, fuel, or power or whenever any person or cor- 
poration engaged in the business of manufacturing, piping, dis- 
tributing or selling artificial or other gas for heat, light, fuel, 
or power, and furnishing the same to its patrons within this 
State, shall desire to dig trenches and lay, maintain or repair 
pipes or maius outside of the limits of corporate cities or towns 
for the purpose of conducting and distributing gas or its pro- 
ducts to its patrons within this State, or from its manufactory 
to its patrons at any point within this State, such person, cor- 
poration or voluntary association shall have the rights and pow 



614 MORRISON'S OIL RIGHTS 

ers conferred upon and granted to, and be subject to the liabili- 
ties and restrictions imposed upon corporations organized for 
the purpose of drilling and mining for petroleum or natural 
gas and marketing the same by an Act entitled "An Act to 
authorize companies organized for the purpose of drilling and 
mining for petroleum or natural gas and marketing the same 
to appropriate and condemn real estate and declaring an emer- 
gency," approved February 20, 1889. Act. 1907, p. 340. Burns 
§ 5144. 

Special Power to Board of Trustees. 

That the subscribers to the capital stock of any company, cor- 
poration or voluntary association, organized for the purpose of 
furnishing natural or artificial gas for fuel or for illuminating 
purposes, or for furnishing electric lights or water to the citi- 
zens of any village, town or city within the State of Indiana, 
may, by written stipulation at the time of making subscriptions 
to the capital of said company, corporation or voluntary asso- 
ciation, and with one another, that the power of holding and 
voting said capital stock may be irrevocably given to a board of 
trustees or a majority of them, which said board of trustees may 
be selected in such manner as the articles of incorporation may 
provide. Act 1889, p. 91. Burns § 5145. 

Section 5145 Made Retroactive. 

That any such agreement heretofore made by the subscribers 
to the capital of any company, corporation or voluntary associa- 
tion organized for the purposes set forth in the preceding sec- 
tion, shall be valid and binding upon said subscribers to the 
capital stock and their assigns. Burns sec. 5146. Id. 

Five Mile Limit to City Gas Companies. 

That any gas light or water works company in any city or 
town of this State shall be authorized and empowered to extend 
their pipes and mains beyond the corporate limits of such city 
or town, not to exceed a distance of five miles from the corpo- 
rate limits of any such city or town, for the purpose .of supply- 



STATE STATUTES 615 

ing persons or corporations with gas or water, and any such 
company shall be authorized and empowered to furnish and 
supply gas or water to any persons or corporations residing or 
located within five miles of the corporate limits of any such city 
or town. Act 1883, p._17. Burns § 5073. 

Assessment of Gas Companies. 

The personal property of gas and coke companies, natural gas 
companies, electric light companies, water works companies and 
hydraulic companies shall be listed and assessed in the township, 
town or city where the principal works are located; the mains, 
pipes and wires of such companies laid in or along roads, streets 
or alleys shall be listed as personal property in the township, 
city or town where the same are laid or placed. Act 1891, p. 
199. Burns § 10,166. 

Annual Statement to Assessor. 

Every street railroad, -water works, gas, manufacturing, min- 
ing, gravel road, plank road, saving (s) bank, insurance and 
other associations incorporated under the laws of this State 
(other than railroad companies and those heretofore specifically 
designated) shall, by its president or other proper accounting 
officer, between the first day of March and the fifteenth day of 
May of the current year, in addition to the other property re- 
quired by this act to be listed, make out and deliver to the as- 
sessor a sworn statement of the amount of its capital stock, set- 
ting forth particularly: 

First. The name and location of the company or association. 

Second. The amount of capital stock authorized, and the 
number of shares in which such capital stock is divided. 

Third. The amount of capital stock paid up. 

Fourth. The market value, or if no market value, then the 
actual value of the shares of stock. 

Fifth. The total amount of indebtedness, except the indebted- 
ness for current expenses, excluding from such expenses the 
amount paid for the purchase or improvement of property. 

Sixth. The value of all tangible property. 



616 MORRISON'S OIL RIGHTS 

Seventh. The difference in value between all tangible prop- 
erty and the capital stock. 

Eighth. The name and value of each franchise or privilege 
owned or enjoyed by such corporation. 

Such schedule shall be made in conformity to such instruc- 
tions and forms as may be prescribed by the auditor of State. 
In case of the .failure or refusal to make report, such corpora- 
tions shall forfeit and pay one hundred dollars for each addi 
tional day such report is delayed beyond the fifteenth day of 
May, to be sued and recovered in any proper form of action in 
the name of the State of Indiana, on the relation of the pros- 
ecuting attorney, such penalty when collected, to be paid into 
the county treasury. And such prosecuting attorney in every 
case of conviction shall be allowed a docket fee of ten dollars 
to be taxed as costs in such action. Act of 1891, p. 199. Amend- 
ed 1903, p. 49. Burns sec. 10233. 

Tax Schedule. 

Such statement shall be scheduled by the assessor and such 
schedule, with the statement so scheduled, shall be returned by 
the assessor to the county auditor. The auditor shall annually, 
on the meeting of the county board of review, lay before said 
board the schedule and statements herein required to be re- 
turned to him, and said board shall value and assess the capita) 
stock- and all franchises and privileges of such companies or 
associations in the manner provided in this Act, and the said 
auditor shall compute and extend the taxes for all purposes on 
the respective amounts so assessed, the same as may be levied 
on other property in such towns, cities or other localities in 
which such companies or associations are located. In all cases 
where the capital stock of any such corporation exceeds in value 
that of the tangible property listed for taxation, then such cap- 
ital stock shall be subject to taxation upon such excess of value; 
where no tangible property is returned or found, and the capital 
stock has a value; it shall be assessed for its true cash value. But 
where the capital stock, or any part thereof, is invested in tan- 
gible property, returned for taxation, such capital stock shall 
not be assessed to the extent that is so invested. Every fran- 



STATE STATUTES 617 

chise or privilege of any such corporation shall likewise be as- 
sessed at its true cash value. Where the full value of any fran- 
chise is represented by the capital stock listed for taxation then 
such franchise shall not itself be taxed; but in all cases where 
the franchise is of greater value than the capital stock, then 
the franchise shall be assessed at its full cash value, and the 
capital stock in such case shall not be assessed. Burns sec. 
10234. 

Assessment, How Enforced. 

In case of the failure or refusal of the person or persons, 
joint stock associations, companies or corporations, their officers, 
agents or employees specified in the preceding section to make 
and return the statements and reports therein provided for, 
the auditor of State shall make out such returns, statements 
and valuations from the best information he can obtain, and 
for that purpose he shall have power to summon and examine, 
under oath, any person whom he may believe to have a knowledge 
thereof. And he shall add to such valuation twenty-five per 
centum thereon. Burns § 10235. 

Minute Directions for Plugging Wells. Notice to Supervisor. 

That before the casing shall be drawn from any well drilled 
into gas or oil-bearing rock for the purpose of abandoning the 
same, it shall be the duty of any person, firm or corporation hav- 
ing the custody of such well, or having charge of removing the 
casing therefrom for the purpose of abandoning the same, at 
the time of such abandonment, to properly and securely stop 
and plug each of said wells so abandoned in the following man- 
ner : Such hole shall first be solidly filled from the bottom there- 
of 'to a point at least twenty-five (25) feet above such gas or oil- 
bearing rock with sand, gravel or pulverized rock, on the top 
of which filling shall be seated a dry pine wood plug not less 
than two (2) feet long and having a diameter of one-fourth of 
an inch less than the inside diameter of the casing in such well ; 
above such wooden plug such well shall be solidly filled for at 
least twenty-five (25) feet with the above-mentioned filling ma- 



618 MORRISON'S OIL RIGHTS 

terial, immediately above this shall be seated another wooden 
plug of the same kind and size as above provided, and such 
well shall again be solidly filled for at lease twenty-five (25) 
feet above said second plug with such filling material. After 
the casing has been drawn from such well there shall immediate- 
ly be seated at the point in said well where such casing was 
seated a cast-iron ball, the diameter of which ball shall be greater 
than that of the hole below the point where such casing was 
seated, and above such ball such well shall again be solidly 
filled with the above-mentioned filling material for a distance 
of fifty (50) feet. Any person, firm or corporation owning or 
having charge or supervision of any well which has been drilled 
into gas or oil-bearing rock, or having charge or control of re- 
moving the drive pipe or casing from any such well, and from 
which the drive pipe and casing or the drive pipe alone has been 
or shall be pulled leaving therein the tubing casing, or both, shall 
give notice to the State natural gas supervision (supervisor), 
and under the supervision and direction of said supervisor, or 
one of his assistants, shall plug such tubing, where such tubing 
only remains in such well, and shall fill from the bottom up not 
less than three hundred (300) feet with cement and clean sand, 
one part Portland cement to four parts of sand, and where the 
casing and tubing remains in any such well, such well shall be 
filled on the packer with not less than fifty (50) feet of Portland 
cement and sand, and if there be no such packer, with not less 
than one hundred (100) feet of Portland cement and sand in 
the proportions hereinbefore indicated, and in all cases where the 
drive pipe and casing or either the drive pipe or casing are re- 
moved from any such well and the tubing is left therein said 
tubing shall be plugged as herein provided, and if any part of 
the tubing, drilling-stem or other substance prevent the plug- 
ging of any such well or wells as hereinbefore provided, such well 
or wells shall be filled to a point within twenty-five (25) feet 
of the top part of said tubing, drill-stem or substance with sand, 
gravel or crushed stone, and shall thereupon be filled to a point 
twenty-five (25) feet above such part of tubing, drill-stem or 
subsiance with Portland cement and sand, all proportioned as 
above provided. Act 1909, p. 234. 



STATE STATUTES 61 ( J 

Duties of Supervisor. Fee. 

Any person, firm or corporation, before proceeding to plug 
any such well so drilled into any gas or oil-bearing rock, or to 
pull the casing or drive pipe therefrom, shall notify the State 
natural gas supervisor, or one of his authorized assistants, of 
such intention, and the time and place where such plugging is 
to be done, and it shall be the duty of said natural gas super- 
visor or his duly authorized assistants to be present in person 
all the time while such plugging is being done, and the same 
shall be done under his instructions and supervision, and such 
person, firm or corporation so plugging such well shall file, or 
cause to be filed, in the office of the recorder of the county in 
which any such well is located, within fifteen days after the same 
has been plugged, as provided in section one (1) hereof, a writ- 
ten statement of such State natural gas supervisor, or his duly 
appointed assistant, showing that such well was duly plugged 
under his personal supervision and instruction and in the man- 
lier herein prescribed and required, which statement shall be 
recorded in the miscellaneous records in the office of such record- 
er. And for supervising and superintending the plugging of 
any such well, said person, firm or corporation plugging such 
well or having the same done, shall pay in advance of doing any 
such work or plugging a fee of five dollars ($5.00) to the State 
natural gas inspector or his assistants, to be by them turned into 
the State Treasury. Id. 

Assistants to Natural Gas Supervisor. 

Sec. 3. For the purpose of enforcing the provisions of this 
act and supervising the plugging of said wells the State natural 
gas inspector shall appoint such assistants as he may deem neces- 
sary, who shall receive for their services for such supervision in 
the plugging of each well the sum of five dollars ($5,00), to be 
paid by the Treasurer of State each month, upon a warrant 
drawn by the Auditor of State, upon a verified statement made 
by said assistants showing the wells plugged by him during such 
month, their location, the date when plugged and by whom the 
fee has been paid, and file the same with the auditor of State. 



♦J20 MORPISOX'S OIL RIGHTS 

Suck verified .statement shall, before any warrant is drawn 
thereon or therefor, be approved by the State natural gas sil 
pervisor, and in no event shall any such assistant be paid any 
such fee until the same shall have been (paid) into the treasury 
of State as herein provided. Id. 

Protection against Salt Water or Oil. 

Sec. 4. It shall be the duty of every person, firm or corpora 
tion who sinks or maintains a well to the depth of the oil or 
salt-bearing strata to prevent the salt water or oil of such well 
from flowing into fresh water strata of that or any other well. Id. 

Casing Out Fresh Water. 

Sec. 5. It shall be the duty of any person, firm or corporation 
sinking a well into any gas or oil-bearing rock, or maintaining 
the same after it has been sunk, to case off and keep cased off 
all fresh water from such well until such well has been plugged 
as herein provided. Id. 

Police Powers of Supervisor. 

Sec. 6. For the purpose of enforcing the provisions of this 
Act the State natural gas supervisor is hereby authorized and 
empowered to enter upon any land at any time for the purpose 
of examining or testing any such well or wells for the purpose 
of plugging the same, and said supervisor and his assistants are 
hereby given police power to arrest persons found violating any 
of the provisions of this Act. Id. 

Penalty. 

Sec. 7. Any person, firm or corporation violating any of the 
provisions of this act shall, on conviction, be fined in any sum 
not less than one hundred dollars nor more than one thousand 
dollars, to which may be added imprisonment in the county jail 
not to exceed six months. Id. 

Sections 8 and 9 are the Repealing and Emergency Sections. 



STATE STATUTES 621 

KANSAS, 

No Well within 100 Feet of Right of Way. 

Par. 10. It shall be unlawful for any person, firm, company 
or corporation in this State to drill or operate gas or oil wells 
within one hundred feet of the center of the right of way of 
any steam or electric line of railway. Act 1905, chap. 210, G. 
S. § 4978. 

Penalty. 

Par. 11. Any person, firm, companj^ or corporation violating 
the provisions of this act shall be deemed guilty of a misdemean- 
or, and upon conviction thereof shall be fined in any sum not 
less than one hundred nor more than one thousand dollars. Id. 
G. S. § 4979. 

Strength of Gas Mains. 

Par. 12. That any person or persons, firm, company or cor 
poration engaged in drilling for, piping, transporting, using or 
selling natural gas may transport or conduct the same through 
sound wrought or cast-iron or steel casings and pipes tested to 
at least four hundred pounds pressure to the square inch. Act, 
1905, eh. 312. G. S. § 4980. 

Increase Flow Forbidden. 

Par. 13. It is hereby declared to be unlawful for any person 
or persons, firm, company or corporation to use any devise for 
pumping, or any other artificial process or appliance that shall 
have the effect of increasing the natural flow of natural gas out 
of any well. Id. G. S. § 4981. 

Penalty. Shooting Well Proviso. 

Par. 14. Any person or persons, firm, company or corpora 
tion violating any of the provisions of this Act shall be deemed 
guilty of a misdemeanor, and upon conviction shall be fined 
in any sum not less than one hundred dollars or more than ten 



622 MORRISON'S OIL RIGHTS 

thousand dollars, and may be enjoined from conveying and 
transporting natural gas through pipes otherwise than in this 
Act provided : Provided, That nothing in this section shall oper- 
ate to prevent the use of nitroglycerine or other explosives for 
shooting any well or wells from which the gas is procured. Id. 
G. S. § 4982. 

Casing Wells to Exclude Water. 

Sec. 26. That the owner or operator of any well put down 
for the purpose of exploring for and producing oil or gas shall, 
before drilling into the oil or gas-bearing rock, encase the well 
with good and sufficient wrought iron, oil-well casing, and in 
such manner as to exclude all surface or fresh water from the 
lower part of such well, and from penetrating the oil or gas- 
bearing rock. Should any well be put down through the first 
into a lower oil or gas-bearing rock, the same shall be cased in 
such manner as will exclude all fresh or salt water from both 
upper and lower oil or gas-bearing rocks penetrated. Act 1891, 
chap. 151, G. S. 4983. 

Plugging Well. 

Sec. 27. The owner of any well, when about to abandon or 
cease operating the same, for the purpose of excluding all fresh 
or^salt water from penetrating the oil or gas-bearing rock or 
rocks, and before drawing the casing, shall fill the well with 
sand or rock sediment to the depth of two feet below the top 
of each oil or gas-bearing rock, and drive therein a round, 
seasoned wooden plug at least two feet in length, and in di- 
ameter equal to the full diameter of the well below the casing 
and immediately upon drawing the casing, shall fill in on top of 
such plug with sand or rock sediment to the depth of five feet, 
and again drive into the well a round wooden plug three feet in 
length, the lower end tapering to a point, and to be of the same 
diameter at the distance of eighteen inches from the smaller end 
as the diameter of the well below the point at which it is driven ; 
and after such plug has been driven, the well shall be filled with 



STATE STATUTES 623 

sand or rock sediment to the depth of twenty feet. Id. G. S. 
§ 4984. 

$500 Fine. 

Sec. 28. Any owner or operator or person, who shall violate 
the provisions of the preceding sections of this Act, shall be 
guilty of a misdemeanor, and shall be fined in the sum of five 
hundred dollars for each and every offence, which fine when 
collected shall be paid to the school fund of the county in which 
the well is situated. Id. G. S. § 4985. 

Record of Surrender of Lease. 

Sec. 1. When any oil, gas or other mineral lease heretofore or 
hereafter given on land situated in any county of Kansas and 
recorded therein shall become forfeited it shall be the duty of 
the lessee, his successors or assigns within sixty days from the 
date of the taking effect of this Act, if the forfeiture occurred 
prior thereto and within sixty days after the date of the for- 
feiture of any other lease, to have such lease surrendered in writ- 
ing, such surrender to be signed by the party making the same, 
acknowledged and placed on record in the county where the 
leased land is situated without cost to the owner thereof; pro- 
vided that if the said lessee, his successors or assigns shall fail 
or neglect to execute and record such surrender within the 
time provided for, then the owner of said land may serve upon 
said lessee, his successors or assigns, in person or by registered 
letter, at his last known address, or by publication for three con- 
secutive weeks in a newspaper of general circulation in the coun- 
ty where the land is situated, a notice in writing in substantial- 
ly the following form: 

To I, the undersigned owner of the following de- 
scribed land situated in county, Kansas, to wit : 

(Description of land) upon which a lease, dated day of 

, 19 .... , was given to , do hereby notify 

you that the terms of said lease have been broken by the owner 
thereof, that I hereby elect to declare and do declare the said 
lease forfeited and void and that, unless you do, within twenty 



624 MORRISON'S OIL RIGHTS 

days from this date, notify the register of deeds of said county 
as provided by law, that said lease has not been forfeited, I will 
file with the said register of deeds affidavit of forfeiture as pro- 
vided by law; and I hereby demand that you execute or have 
executed a proper surrender of said lease and that you put the 
same of record in the office of the register of deeds of said county 
within twenty days from this date. 
Dated this day of , 19 .... 

Proof of Forfeiture by the Owner. 

And the owner of said land may after twenty days from the 
date of service, registration or first publication of said notice, 
file with the register of deeds of the county where said land is 
situated an affidavit setting forth that the affiant is the owner 
of said land, that the lessee, or his successors or assigns, has 
failed and neglected to comply with the terms of said lease, re- 
citing the facts constituting such failure ; that the same has been 
forfeited and is void ; and setting out in said affidavit a copy of 
the notice served, as above provided and the manner and time 
of the service thereof. If the lessee, his successors or assigns, 
shall within thirty days after the filing of such affidavit, give 
notice in writing to the register of deeds of the county where 
said land is located that said lease has not been forfeited and 
that said lessee, his successors or assigns still claims that said 
lease is in full force and effect, then the said affidavit shall not be 
recorded, but the register of deeds shall notify the owner of the 
land of the action of the lessee, his successors or assigns, and 
the owner of the land shall be entitled to the remedies now pro- 
vided by law for the cancellation of such disputed lease. If the 
lessee, his successors or assigns shall not notify the register 
of deeds as above provided, then the register of deeds shall re- 
cord said affidavit and thereafter the record of the said lease 
shall not be notice to the public of the existence of the said lease 
or of any interest therein or rights thereunder and said record 
shall not be received in evidence in any court of the state on 
behalf of the lessee, his successors or assigns, against the lessor, 
his successors or assigns. Act of 1915, p. 284, G. S. § 4992. 



STATE STATUTES 625 

Record Not to Be Notice of Indefinite Term. 

Se< . 2. That when an oil, gas or mineral lease is hereafter 
given on land situated within the State of Kansas, the recording 
thereof in the office of the register of deeds of the county in 
which the land is located shall impart notice to the public of 
the validity and continuance of said lease for the definite term 
therein expressed, but no longer; provided, that if such lease 
contains the statement of any contingency upon the happening 
of which the term of any such lease may be extended (such as 
"and as much longer as oil and gas or either are produced in 
paying quantities"), the owner of said lease may at any time 
before the expiration of the definite term of said lease file with 
said register of deeds an affidavit setting forth the description of 
the lease, that the affiant is the owner thereof and the facts 
showing that the required contingency has happened. This af- 
fidavit shall be recorded in full by the register of deeds, and such 
records, together with that of the lease, shall be due notice to 
the public of the existence and continuing validity of said lease 
until the same shall be forfeited, canceled, set aside or surren- 
dered according to law. Id. G. S. § 4993. 

Action on Failure to Release. 

Par. 19. Should the owner of such lease neglect or refuse to 
execute a release as provided by this Act, then the owner of the 
leased premises may sue in any court of competent jurisdiction 
to obtain such release, and he may also recover in such action 
of the lessee, his successors or assigns, the sum of one hundred 
dollars as damages, and all costs, together with a reasonable at- 
torney's fee for preparing and prosecuting the suit, and he may 
also recover any additional damages that the evidence in the 
case will warrant. In all such actions, writs or attachment may 
issue as in other cases. Act 1909, ch. 179, G. S. 4994. 

Proof of Demand for Release. 

Par. 20. At least twenty days before bringing the action pro- 
vided for in this Act, the owner of the leased land, either by 
himself or by his agent or attorney, shall demand of the holder 
M. O. R.— 40. 



626 MORRISON'S OIL RIGHTS 

of the lease (if such demand by ordinary diligence can be made 
in this State), that said lease be released of record. Such de- 
mand may be either written or oral. When written, a letter- 
press or carbon copy thereof, when shown to be such, may be 
used as evidence in any court with the same force and effect as 
the original. Id. G. S. § 4995. 

County Gas Inspector. 

Par. 24. In each county in this State the board of County 
commissioners is hereby authorized, in its discretion, to appoint 
a suitable and competent person, who shall not be interested 
privately in producing, piping or selling natural gas, to be 
known and designated as the "gas inspector" of such county, 
who shall serve for a term of two years from the date of his 
appointment and qualification and until his successor shall be 
appointed and qualified: Provided, That said board may end 
said term by an order to that effect at any time after the expira- 
tion of said period of two years without appointing such succes- 
sor. Act 1905, ch. 313, G. S. § 5000. 

Oath and $3,000 Bond. 

Par. 25 He shall be required, before assuming the duties of 
his office, to take and subscribe an oath or affirmation that he 
will faithfully, impartially and to the best of his skill and ability 
discharge his duties, which oath or affirmation shall be filed with 
the county clerk of the county for which he is appointed, and 
within ten days after his appointment he shall file with said 
county clerk a good and sufficient bond to the people of the State 
of Kansas, with a resident surety or sureties to be approved by 
said county commissioners, in the sum of three thousand dollars, 
conditioned for the faithful performance of his duties. Id. G. 
S. § 5001. 

Duty to Report Wells. 

Par. 26. All persons are hereby required to report in writing, 
by mail or otherwise, to said inspectors, within thirty days 
after their appointment and qualification, the location and num- 



STATE STATUTES 627 

ber of all wells in the county of such inspector belonging- in 
whole or part to them or which are upon premises owned in 
whole or part by them, except only such wells as have already 
been reported to some predecessor of said inspector, and they 
shall also report to him in writing the number and location of 
each of such gas wells thereafter drilled within two days after 
its completion. Id. G. S. 5002. 

Duty to Report Violation. 

Par. 27. It shall be the duty of such inspector to see that 
all provisions of law pertaining to the drilling for gas, the 
regulating of gas wells and the piping and consumption of nat- 
ural gas are faithfully carried out, and that the penalties of such 
laws are enforced against all violators of the same; and to that 
end he shall promptly report all violations of such laws that 
come to his knowledge to the county attorney of his county, and 
file a proper complaint for the prosecution of the offender. Id. 
G. S. § 5003. 

Record of Inspections. 

Par. 28. Said inspector shall inspect all gas wells in his 
county. He shall measure and record, as nearly as can be ascer- 
tained, the initial rock-pressure of, and also the volume of gas 
produced by, each of such wells. Such inspection shall be made 
and measurements taken and recorded at least once in each six- 
months' period during his term of office, and at any other time 
or times directed by the board of county commissioners. All 
such records shall be entered and kept in substantially bound 
record books, suitably ruled, printed," indexed and arranged for 
that purpose, to be provided by the county and kept in the of- 
fice of the register of deeds subject to public inspection. Id. 
G. S. § 5004. 

Inspection of Pipe Lines. 

Par. 29. Such inspector shall also inspect" all natural gas 
pipe lines in his county at least once in every period of six 
months during his term of office, and as much oftener as may 



628 MORRISON'S OIL RIGHTS 

be necessary or as may be directed by the board of county com- 
missioners, and shall test and record the pressure of the gas 
therein and the volume of the flow through the same, as nearly 
as is practicable. If he shall discover any leakage or waste of 
gas from any such well or pipe line,, he shall notify the owner 
thereof, or his agents or servants, or some one of them, of that 
fact, and if such leakage or waste be not stopped within two 
days after such notice, it shall be and it is hereby made the duty 
of such inspector to take such steps and make such changes and 
repairs as may in his judgment be necessary to stop said waste 
or leakage ; and he shall have a lien upon said well or pipe line 
and all wells with which the same may be connected for the ma- 
terial, labor and cost of making such repair, for the enforcement 
of which, with all costs of suit, and a reasonable attorney's fee. 
an action may be maintained by said inspector in any court of 
competent jurisdiction; and if gas shall be taken from any well 
at a rate such as to consume more than fifty per cent, of its 
daily production, it shall be deemed a waste within the mean- 
ing of this clause to the extent of such excess. If any owner of 
any such well or pipe line, or any agent or servant of such owner 
in charge and control of such well or pipe line, shall for more 
than two days after the service of the notice last aforesaid fail 
to stop the leakage or waste by this clause prohibited, such own- 
er, agent or servant shall be guilty of a misdemeanor, and on 
conviction thereof shall be fined a sum of not less than twenty- 
five dollars nor more than five hundred dollars for each offense, 
and each day that such failure continues after the expiration 
of the said period of two days, shall constitute a separate of- 
fence. Id. G. S. § 5005. 

Interference with Inspector. 

Par. 30. No person or persons in this State owning or having 
control of natural gas wells or natural gas pipe lines shall refuse 
to allow the same to be inspected by the natural gas inspector, nor 
shall any such person interfere with said inspector, directly or in- 
directly in the performance of his duties as herein prescribed, 
and it is made the duty of all such persons to furnish said in- 
spector reasonable facilities and opportunity to make any in- 



STATE STATUTES f>29 

speetion or perform any duty hereby authorized. Id. G. S. 
§ 5006. 

Deputy Inspectors. 

Par. 31. The inspector provided for in this Act is hereby 
authorized, with the consent and approval of the board of coun- 
ty commissioners, to appoint and assign for duty deputies, not 
exceeding two in number, at such time and for such terms as 
in his judgment may be necessary to enable him promptly to 
perform all the duties of his office. Such deputies shall have 
the same qualifications as the inspector, and under his direction 
are empowered to perform all the duties of the inspector. Said 
inspector shall be liable for all acts or omissions of his deputies 
in the performance of their duties. Each deputy, before he 
centers upon the duties of his office, shall execute a bond to the 
inspector, with sureties to be approved by him, in the sum of 
one thousand dollars, which shall be filed with the inspector, and 
shall be conditioned for the faithful performance of the duties 
of such deputies. The said inspector shall provide himself and 
deputies with proper standard instruments and appliances for 
use in the performance of his and their duties in making the 
tests and records herein designated. Id. G. S. § 5007. 

Par. 32. Any person violating any of the foregoing provi- 
sions of this Act, except those for the violation of which pen- 
alties are especially prescribed, shall be guilty of a misdemeanor, 
and on conviction thereof shall be fined in the sum of not less 
than twenty-five dollars nor more than five hundred dollars. Id. 
§ 5008. 

Per Diem of Inspectors. 

Par. 33. The compensation of such inspectors shall be five 
dollars per day for the time actually and necessarily consumed 
by them in the performance of their duties as herein pre- 
scribed, and the compensation of each deputy inspector shall 
be four dollars per day for each day actual^ and necessarily 
consumed by him in the performance of his duties as herein 
prescribed, and the same shall be paid by the county in which 



630 MORRISON'S OIL RIGHTS 

such service is performed, upon allowance by the board of coun- 
ty commissioners, as other claims against such county. Id. 
§ 5009. 

Appointment of County Inspector to Supervise Plugging. 

Section 1. For the purpose of carrying out the provisions of 
section 3919 of the General Statutes of 1909. The Board of 
county commissioners of each county in the State of. Kansas in 
which oil or gas wells have been drilled or may hereafter be 
drilled may appoint some suitable person who has had at least 
two years' experience in drilling and operating oil or gas wells 
and who is not directly interested in the production of gas or 
oil to personally direct and supervise the plugging of oil or gas 
wells sought to be plugged, whose terms of service shall be at 
option of the county commissioners, but who shall serve until 
his successor is appointed. Act of 1913, p. 345, G. S. § 4986. 

Operator to Notify Inspector. 

Sec. 2. Whenever it shall become necessary to plug any well 
as required by law the lessee or operator shall notify in writing 
the inspector of oil and gas wells at his office or residence, where- 
upon he shall repair as soon as possible to said well and super- 
vise the plugging thereof. Id. G. S. § 4987. 

Log of Well to Inspector. 

Sec. 3. Upon the arrival of the said inspector at the wells 
to be plugged the lessee or operator shall furnish to the inspect- 
or a record of the drilling of said well verified under oath show- 
ing a true log of such well. Id. G. S. § 4988. 

Penalty. 

Sec. 4. Any person, corporation or copartnership violating 
any of the provisions of this act shall upon conviction thereof 
be deemed guilty of a misdemeanor, and upon conviction be 
fined in a sum of not more than $500 or by imprisonment in 



STATE STATUTES 631 

the county jail not more than six months, or by both such fine 
and imprisonment. Id. G. S. § 4989. 

Oil Inspector to Be Paid by Operator. 

Sec. 5. The oil well inspector shall receive a sum of $5.00 per 
well and actual traveling expenses while in performance of 
his duties of inspection; provided, also, that the cost of said 
inspection shall be paid by the owner or operator of said wells. 
Id. G. S. § 4990. 

Protection of City Water Supply. 

Section 1. That all persons, companies or corporations are 
hereby prohibited from wilfully, carelessly or negligently per- 
mitting or causing any salt water, oil or other polluting sub- 
stances to flow into any stream, lake or reservoir within the State 
of Kansas, so as to render said water deleterious for- use for 
domestic purposes, which furnishes any city within said State 
with its water supply for domestic purposes. Act, 1917, p. 346. 

Penalty. Limitation. 

Sec. 2. That any violation of section 1 of this Act shall be 
a misdemeanor, punishable by fine of not less than tweirty-five 
dollars, nor more than^one hundred dollars, and each separate 
day on which said section 1 may be violated shall constitute a 
separate offence: Provided, that all prosecutions under this act 
must be begun within ninety days after the commission of the 
offence. Id. 

Pipe Lines Are Common Carriers. 

Par. 58. All pipe lines laid, built or maintained for the con- 
veyance of crude oil within the State of Kansas are hereby de- 
clared to be common carriers, and said conveyance of said oil 
shall be in the manner and under the restrictions in this Act 
provided. Act 1905, ch. 315, G. S. § 5035. 



632 MORRISON'S OIL RIGHTS 

Pipe Line to Provide Storage. 

Par. 59. It shall be the duty of every person, firm, associa- 
tion or corporation operating* under such pipe line to provide 
suitable and necessary receptacles for receiving such oil for 
transportation and for storage at the place of delivery until 
the same can be reasonably removed by the consignee, and shall 
be liable therefor from the time the same is delivered for trans- 
portation until a reasonable time after the same has been trans- 
ported to the place of consignment and ready for delivery to 
the consignee. It shall be the duty of every such person, firm, 
association or corporation to receive and forward such oil as 
shall be offered for shipment in the order of application there- 
for, upon the applicant's complying with the rules herein pro- 
vided for as to delivery and payment for such transportation. 
Such common carrier shall issue to the shipper a certificate show- 
ing the actual quantity and specific gravity thereof; but no ap- 
plication for such transportation shall be valid beyond or for 
a greater quantity than the applicant has ready for delivery 
at the time of making such application. Id. G. S. § 5036. 

Fixed Rates for Carriage. 

Par. 60. It shall be unlawful for any such person, firm, as- 
sociation or corporation to charge for the transportation of such 
crude oil through its line in excess of the following rates for 
each barrel of forty-two gallons transported : Six miles and less, 
five cents; over six miles and not more than fifteen miles, six 
cents ; over fifteen miles and not more than forty miles,, seven 
cents; over forty miles and not more than eighty miles, eight 
cents; over eighty miles and not more than one hundred miles, 
ten cents; over one hundred miles and not more than one hun- 
dred and fifty miles, fifteen cents; over one hundred and fifty 
miles and not more than two hundred miles, twenty cents; over 
two hundred miles and not more than two hundred and fifty 
miles, twenty-three cents; over two hundred and fifty miles and 
not more than three hundred miles, twenty-five cents. 1<1. Q. 
S. § 5037. 



STATE STxVTUTES 633 

Railroad Commissioners to Control. 

Par. 61. The State board of railroad commissioners shall have 
the general supervision and control over all such persons, firms, 
associations or corporations in the performance of said business, 
and shall prescribe reasonable rules for the conduct thereof, 
which rules, when prescribed and delivered in writing to any 
such person, firm, association, or corporation, shall be printed 
and posted up in a convenient, accessible and conspicious place 
at each office, station or place of business where such oil is 
received or delivered. The State board of railroad commis- 
sioners is hereby authorized to prescribe reasonable maximum 
rates, not exeeeding the rates set forth in section 3 hereof, which 
shall be charged for the transportation of such oil, which rate 
shall be binding on every such person, firm, association or cor- 
poration after its publication in the official State paper: Pro- 
vided, The reasonableness of such rates may be tested by pro- 
ceedings therefor in any court of competent jurisdiction in this 
State, and such court shall, upon hearing the same, make such 
order as shall be proper, and such order may be reviewed by the 
Supreme Court as other civil proceedings, regardless of sum or 
value involved; Provided, Before beginning such proceedings 
in court to test such matters, such person, firm, association or 
corporation shall execute a bond to the State of Kansas in such 
reasonable sum as the judge of the court in which such matter 
is brought shall order, conditioned that the person, firm, asso- 
ciation or corporation making such application will promptly 
pay to any shipper the difference between the rate received for 
transporting oil and the rate finally ordered by such court. 
When such maximum rates shall be fixed by the State board of 
railroad commissioners, the rates prescribed in section 3 of this 
Act shall cease to be of force, and the rates so fixed by the State 
board of railroad commissioners shall govern, as in this section 
provided. Id. G. S. § 5038. 

Statutory Damages. 

Par. 62. Any such person, firm, association or corporation 
which shall fail or refuse to accept, transport and deliver oil 



634 MORRISON'S OIL RIGHTS 

when offered, up to the full capacity of such pipe line, at rates 
not to exceed those provided for by this Act, or shall fail, neg- 
lect or refuse to obey any rule so established by the State board 
of railroad commissioners, shall be liable to the person injured 
by such failure or refusal in the sum of five hundred dollars 
liquidated damage, together with reasonable attorney's fees, to 
be fixed by the Court, in case suit shall be brought therefor; 
such liquidated damages and attorney's fees to be recovered in 
any Court of competent jurisdiction; and in case of any corpo- 
ration so refusing or failing, the charter board is hereby au- 
thorized to revoke the charter or permit to do business in this 
State of such corporations. Id., G. S. § 5039. 

Escape of Gas. 

Sec. 1. That it shall be unlawful for any person, firm or 
corporation having possession or control of any natural gas' or 
oil well, whether as a contractor, owner, lessee, agent, or man- 
ager, to use or permit the use of gas by direct well pressure 
for pumping of oil or for blowing oil out of wells, or for operat- 
ing any machinery by direct well pressure of gas, or to allow 
or permit the flow of gas or oil from. any such well to escape 
into the open air without being confined within such well or 
proper pipes or other safe receptacle for a longer period than 
two days after gas or oil shall have been struck in such well : 
Provided, That a reasonable time, not exceeding five days, shall 
be allowed such contractor, owner, lessee, agent, or manager, 
in addition to said two days, in which to place in said well the 
casing, tubing, packer's and other appliances necessary to prop- 
erly operate the same and obtain the products therefrom, or, 
in case such contractor, owner, lessee, agent, or manager shall 
not desire to operate such well, to securely enclose the same, so 
as to prevent the escape of oil or gas therefrom, and thereafter 
all such gas or oil shall be safely and securely confined in such 
well, pipes, or other proper receptacle: And provided, further, 
That the provisions of this section shall not be construed to aj) 
ply to the escape of gas or oil during continuous drilling. Any 
person violating any of the provisions of this section shall be 
deemed guilty of a misdemeanor, and shall be fined in the sum 



STATE STATUTES 635 

of not less than fifty dollars, nor more than two hundred dol- 
lars, or by imprisonment in the county jail for not less than 
thirty daj^s nor more than six months, and each day that the vio- 
lation continues shall constitute a separate offense. Act 1901, 
eh. 224, G. S. § 4970. 

Flambeau Lights Prohibited. 

Sec. 2. That it shall be unlawful for any company, corpora- 
tion, or person, for hire, pay, or otherwise, to use natural gas 
for illuminating purposes in what are known as "flambeau" 
lights in cities, towns, highways, or elsewhere; providing, that 
nothing herein contained shall be so construed as to prohibit 
any such company, corporation, or person from the necessary 
use of such gas in what are known as "Jumbo" burners; en- 
closed in glass globes or lamps, or by the use of other burners 
of similar character so enclosed as will consume no more than 
said "Jumbo" burners. Id. G. S. § 4971. 

Jumbo Burners. 

Sec. 3. All gas lights made through said "Jumbo" burners 
enclosed in glass globes or lamps used in all public streets, and 
elsewhere outside of buildings, shall be turned off not later than 
eight o'clock in the morning each day such lights or burners 
are used, and the same shall not be lighted between the hours 
of eight o'clock a. m., and five o'clock p. m. Id. G. S. § 4972. 

Penalty. 

Sec. 4. Any person, company or corporation violating any 
t)f the provisions of sections 2 and 3 of this Act shall be deemed 
guilty of a misdemeanor, and be fined in the sum of not less 
than fifty dollars nor more than two hundred dollars. Id. G. S. 
§ 4973. 

Interfering with Pipes. 

# Sec. 5. That it shall be unlawful for am r person, in any man- 

ner whatsoever, to change, injure, extend, or alter, or cause to 



636 MORRISON'S OIL RIGHTS 

be changed, injured, extended, or altered, any surface or other 
pipe or attachment of any kind connecting or through which 
natural or artificial gas is furnished from the gas mains or pipes 
of any person, company, or corporation without first procuring 
from such person, company, or corporation written permission 
to make such change, extension, or alteration. Id. G. S. § 4974. 

Connection and Cut-offs. 

Sec. 6. That it shall be unlawful for any person to make or 
cause to be made any connection or re-connection with the gas 
mains or surface pipes of any person, company, or corporation 
furnishing natural gas, or to turn on or off or in any manner 
interfere with any valve, stop-cock, or other appliance belonging 
to such person, company, or corporation and connected with its 
surface or other pipes, or alter or injure the orifice of mixers, 
or to use natural gas for heating purposes except through 
mixers, without first procuring from such person, company, or 
corporation a written permit to turn on or off such stop-cock 
or valve, or to make such connections or re-connections, or to 
alter or injure the orifice of mixers, or to interfere with the 
valves, stop-cocks, or other appliances of such person, company. 
or corporation, as the case may be. Id. G. S. § 4975. 

Firing or Interfering with Gas Wells. 

Sec. 7. That it shall be unlawful for any person or persons 
to set fire to any gas escaping from wells, broken or leaking 
mains, pipes, valves, or other appliances used by any person, 
company, or corporation in conveying gas, or to interfere in 
any manner with the wells, machinery, or property of any per- 
son, company, or corporation engaged in drilling for natural 
gas or in furnishing the same, unless employed by or acting 
under the authority or direction of such person, company, or 
corporation engaged in so furnishing gas. Id. G. S. § 4976. 

Fines and Damages. 

Sec. 8. Any person violating any of the provisions of sec- 
tions ">, 6 and 7 of this Act shall be deemed guilty of a mis- 



STATE STATUTES 637 

demeanor, and, upon convict ion, shall be fined not less than 
twenty-five dollars nor more than one hundred dollars, and 
shall be liable to the said person, 'company, or corporation, whose 
property was so changed, injured, altered, or destroyed, in a 
civil action for the amount of damages sustained, together with 
all the costs in the case. Id. G. S. § 4977. 

Wells Required to Case against Salt Water. 

Section 1. If any well or other excavation be put down to or 
through any vein or strata containing salt water or water con- 
taining any minerals in appreciable quantities, it shall be the 
duty of the owner or operator, driller or person putting down 
such well or excavation to case or plug such well or excavation 
in such manner as to exclude all salt water or water containing 
minerals in appreciable quantities from both upper and lower 
veins or strata holding water suitable for domestic purposes. 
Act 1919, p. 309. 

Injunction to Enforce the Act. 

Sec. 2. All persons, companies or corporations, private or 
municipal, owning or controlling a supply of water for domestic 
purposes, injured or threatened with injury by a violation of 
the Drovisions of section 1 of this Act, shall be entitled to a 
remedy by injunction, mandatory or prohibitive, in any Court 
of competent jurisdiction against any person, company or cor- 
poration causing or threatening to cause such injury. Id. 

Penalty. Limitation. 

Sec. 3. Any violation of section 1 of this Act shall be a mis- 
demeanor, punishable by fine of not more than $1,000. Prosecu- 
tions under this Act must be begun within six months after the 
commission of the offense. Id. 

KENTUCKY. 

Right of Eminent Domain Conferred, 

All corporations or companies organized for the purpose of 



638 MORRISON'S OIL RIGHTS 

constructing, maintaining or operating oil or gas well^or wells 
or pipe line or lines for conveying, transporting or delivering 
oil or gas, or both oil and gas, -are hereby vested with the right 
and power to condemn lands and material in this Common- 
wealth, or the use and occupation of so much thereof as may be 
necessary for constructing, maintaining and operating such pipe 
line, or lines, and all necessary machinery, pumping stations, 
appliances and fixtures, including tanks, telephone and tele- 
graph lines, for use in connection therewith, together with the 
rights of ingress and egress to examine, alter, repair, maintain 
and operate or remove such pipe line or lines, all such being 
hereby declared to be a public use ; and when any such corpo- 
ration or company desires to construct oil or gas pipe line or 
lines, or both, for the purpose of conducting, . transporting or 
delivering oil or gas, or both, over the lands of others, shall be 
unable to contract or agree with the owner or owners of land 
or material necessary for its use for said purpose, it may, in the 
mode prescribed for, the condemnation of land for railroads, 
condemn the use of so much of said land as may be necessary 
for the purpose of constructing, maintaining and operating such 
pipe line or lines, and all necessary machinery, pumping sta- 
tions, appliances and fixtures, including necessary tanks, tele- 
phone and telegraph lines, and including rights of ingress and 
egress to examine, alter, repair, maintain and operate or remove 
the same. Act March 20, 1900, Ky. St. § 3766 B. 

Preamble. 

WHEREAS, It is most injurious and detrimental to oil and 
gas wells and contiguous and adjacent land, and even detri- 
mental to oil and gas lands in the neighborhood, and especially 
land in close proximity to an oil' well, either dry or producing, 
that casing be taken from said well without plugging same, so 
as to prevent the surface water that may enter said well flowing 
underground to and destroying other oil and gas wells in close 
proximity to same. 

BE IT ENACTED by the General Assembly of the Common- 
wealth of Kentucky: 



STATE STATUTES 639 

Series of Plugs Required. 

It shall be unlawful for any person or persons, corporations 
or companies to abandon any oil or gas wells, either dry or 
producing", in this Commonwealth, or to remove casings there- 
from, whether same be either oil or gas, either producing or 
dry. or for any cause abandon said well or wells without first 
plugging the same in a secure manner by placing a plug of pine, 
poplar or some other material which will prevent said well from 
becoming flooded, said plug to be placed above the oil-producing 
sand or sands, and filled in above for the distance of seven feet 
with sediment or clay and placing upon the same another plug 
of similar material as that of the first and also placing about ten 
feet below the said casing another plug of like material as above 
referred to, seven feet of sediment or clay, and then another 
plug, all plugs to be securely driven in so that no water can 
pass the same, before the casing is removed. Sec. 1, Acts 1906, 
p. 281. 

Penalty. 

Any jDerson or persons, corporations or companies refusing 
or failing to comply with the foregoing provisions as provided 
for in section 1 herein, shall, on conviction, be fined in any 
sum not less than one hundred dollars, or not more than one 
thousand dollars, in the discretion of the jury. Act March 17. 
1906, Ky. St. § 3914 A. 

Salt Water Must Not Escape. 

That from and after the passage of this Act, any person or 
corporation, and each and every of them, in possession, whether 
as owner, lessee, agent or manager of any well in which petro- 
leum, natural gas or salt water has been found, shall, unless 
said product is sooner utilized, within a reasonable time, not; 
however, exceeding three months from the completion of said 
well, in order to prevent said product wasting by escape, shut 
in and confine the same in said well until such time as it shall 
be utilized: Provided, however. That this section shall not 



640 MORRISON'S OIL RIGHTS 

apply to gas escaping from any well while it is being operated 
as an oil well, or while it is used for fresh or mineral water. 
Act May 14, 1892, Ky. St. § 3910. 

Plugging Section of 1892. 

That whenever any well shall have been shut down for the 
purpose of drilling or exploring for oil, gas or salt water, upon 
abandoning or ceasing to operate the same, the person or cor- 
poration in possession as aforesaid shall, for the purpose of ex- 
cluding all fresh water from the gas-bearing' rock, and before 
drawing the casing, fill up the well with sand or rock sediment 
to a depth of at least twenty feet above the rock which holds 
the oil, gas or salt water, and drive a round, seasoned wooden 
plug, at least three feet in length, equal in diameter to the dia- 
meter of the well below the casing, to a point at least five feet 
below the bottom of the casing; and immediately after drawing 
the casing, shall drive a round, seasoned wooden plug, at a point 
just below where the lower end of the casing rests, which plug 
shall be at least three feet in length, tapering in form, and of 
the same diameter, at the distance of eighteen inches from the 
smaller end, as the diameter of the hole below the point at which 
it is to be driven. After the plug has been properly driven, 
there shall be filled on top of the same sand or rock sediment 
to the deepth of at least five feet. Id., § 3911. Doubtless killed by 
§ 3914 A. 

Penalty for Violation of Section 3910 or 3911. 

Any person or corporation who shall violate any of the pro- 
visions of sections 3910 or 3911 shall be liable to a penalty of one 
hundred dollars for each and every violation thereof, and to the 
further penalty of one hundred dollars for each thirty days 
during which said violation shall continue; and all such penal- 
ties shall be recovered, with cost of suit, in a civil action or 
actions, in the name of the State, for the use of the county in 
which the well shall be located. Id., § 3912. 



STATE STATUTES 641 

Adjoining Owners May Close Abandoned Well. 

Whenever any person or corporation in possession of any 
well in which oil, gas or salt water has been found, shall fail 
to comply with the provisions of section ,3910, any person or cor- 
poration lawfully in possession of lands situate adjacent to or 
in the neighborhood of said well, may enter upon the lands upon 
which said well is situated, and take possession of said well from 
which oil, gas or salt water is allowed to escape or waste in vio- 
lation of said section 3910, and tube and pack said well, and shut 
in said oil, gas or salt water, and may maintain a civil action 
in any Court of this State against the owner, lessee, agent or 
manager of said well, and each and every of them, jointly 
and severally, to recover the cost thereof. This shall be in addi- 
tion to the penalties provided by the [the next above] section 
3912. Id., § 3913. 

Recovery of Costs by Adjoining* Owner. 

Whenever any person or corporation shall abandon any well, 
and shall fail to comply with section 3911, any person or cor- 
poration lawfully in possession of lands adjacent to or in the 
neighborhood of said well, may enter upon the land upon which 
said well is situated, and take possession of said well, and plug 
the same in manner provided by section 3911, and may maintain 
a civil action in any Court of this State against the owner or 
person abandoning said well, and every one of them, jointly and 
severally, to recover the cost thereof. This shall be in addition 
to the penalties provided by section 3912: Provided, This sec- 
tion shall not apply to persons owning the lands on which said 
well or wells are situated, and drilled by other parties; and in 
case the person or corporation drilling said well or wells is in- 
solvent, then, in that event, any person or corporation in pos- 
session of lands adjacent to or in the neighborhood of said well 
or wells, may enter upon the land upon w x hich said well or well> 
are situated, and take possession of said well or wells, and plug 
the same in the manner provided for in section 3911, at their 
own expense. Id., § 3914. 
M. 0. E.— -11. 



<)42 morrison's oil rights 

State Oil Tax Act 

Production Tax on Oil. 

Sec. 1. Every person, firm, corporation or association pro- 
ducing crude petroleum oil in this State, shall, in lieu of all 
other taxes on the wells producing said crude petroleum, an- 
nually pay a tax equal to 1 per centum of the market value of 
all crude petroleum so produced, and such tax shall be for State 
purposes, and, in addition any county in the State may impose a 
like tax for road purposes, county purposes or school purposes, 
not to exceed one-half of one per centum of the market value 
of all crude petroleum produced in such county, and the fiscal 
Court of any county may levy said tax for county purposes and 
shall determine what fund or funds shall receive the taxes when 
collected, and, when crude petroleum is produced in any separate 
taxing district in a county, the fiscal Court shall equitably dis- 
tribute such taxes between the county and such taxing district. 

Levy and Notice of Levy. 

Sec. 2. Any county imposing the tax provided in section 1 
hereof shall immediately, after the levy of such tax, give notice 
thereof to each transporter of crude petroleum registered in 
said county, and the transporter of said crude petroleum shall, 
from and after the first day of the month immediately following 
such notice, proceed as hereinafter provided, to collect such 
county tax, and shall pay the same to the sheriff of such county in 
the manner and at the time payment of such taxes shall be 
required to be made to the State Tax Commissioner. Each 
county imposing such tax shall also, upon the fixing of the 
levy, certify the same to the State Tax Commission, which 
shall make the assessment for such county tax, in the same 
manner and at the same value as provided for the State tax, 
which shall be certified to such county for collection. 

When Tax Attaches. 

Sec. 3. The tax hereby provided for shall be imposed and 



STATE STATUTES 643 

attach when the crude petroleum is first transported from the 
tanks or other receptacles located at the place of production. 

Fegistry. 

Sec. 4. Every person, firm, corporation or association re- 
quired to report under section 5 of this Act, shall register as a 
transporter of crude petroleum in the clerk's office in each 
county of this State, in which such business is carried on by 
such transporter of crude petroleum, in a book which the State 
Tax Commission shall provide therefor, showing the name, resi- 
dence and place of business of such transporter of crude petro- 
leum, and it shall be the duty of the county clerk of each county 
to immediately certify to the State Tax Commission a copy of 
each registration as made. 

Transporter Denned. Monthly Reports. 

Sec. 5. Every person, firm, corporation or association engaged 
in the transportation of crude petroleum in the State from trie 
tanks or other receptacles located at the place of production in 
the State, shall, for the purposes of this Act, be considered a 
transporter of crude petroleum, and every such transporter 
of crude petroleum shall make a monthly, verified report to 
the State Tax Commission, on or before the 20th day of the 
month succeeding the month in which the crude petroleum is 
so received for transportation, showing the quantity of each kind 
or quality of all crude petroleum so received from each 
county in the State and the market value of such crude petro- 
leum on the first business day after the tenth day of the 
month in which such report is made and such report shall show 
any sales of such crude petroleum so received, in which event 
it shall show the quantity of crude petroleum in each sale, the 
date of each sale, and the market price of such crude petroleum 
on each. date of sale for such preceding month, and said report 
shall be made upon blanks furnished and prescribed by the 
State Tax Commission. 



f>44 MORRISON'S OIL RIGHTS 

Assessment Procedure. 

Sec. 6. The State Tax Commission shall, upon receivingg the 
reports provided for in section 5 hereof, upon such reports and 
such other reports and information as it may secure, assess the 
value of all grades or kinds of crude petroleum so reported for 
each month, and, on or before the last day of the month in which 
such reports are required to be made, notify each transporter 
of crude petroleum so reporting of such assessment, and certify 
such assessment to the county clerk of each county which has 
reported the levy of the county tax provided for in section 2, 
for record, and such county clerk shall immediately deliver a 
copy thereof to the sheriff of such county for the collection of 
such county tax. The transporter so notified of the assessment 
shall have until the twentieth day of the month following such 
notice, in which to be' heard by the State Tax Commission on 
any objection to such assessment, and the assessment shall be- 
come final on such twentieth day of the month and the tax be due 
and payable on that day. The State Tax Commission shall 
make the assessment of the value of the crude petroleum so re- 
ported by each transporter of crude petroleum as follows: 

Oil Unsold. 

Where the report shows no sale of crude petroleum during 
the month covered by such report, then the market value of 
crude petroleum on the first business day after the tenth day of 
the month in which the report is made shall be fixed as the as- 
sessed value of all crude petroleum covered by such report. 

But where the report shows sales of crude petroleum during 
the month covered by such report, if it shows that all crude pet- 
roleum so reported has been sold, then the market price of such 
crude petroleum on each day of such sale or sales shall be the 
assessed value of all crude petroleum sold on such date of sale 
and the total amount of the tax to be reported as the assessment, 
on such report shall be the total of the assessment or assessments 
made on such* sale or sales ; but if such report shows that any 
part of the crude petroleum so reported remains unsold, then as 
to such portion remaining unsold the market price of the crude 



STATE STATUTES 645 

petroleum on the first business day after said tenth day of the 
month following the month covered by such report, shall be fixed 
as the assessed value of such portion of the crude petroleum 
unsold, and the total amount of the tax to be reported as the 
assessment on such report shall be the total of the assessments 
made on such sold and unsold crude petroleum. 

Deduct Freight. 

The State Tax Commission in making its assessments shall 
take into consideration transportation charges. 

Payment in Kind. 

Sec. 7. Every person, farm, corporation or association re- 
quired to make report as provided in section 5 hereof, shall be 
responsible and liable for the taxes as herein set forth on all 
crude petroleum so received by it, and shall collect from the 
producer in either money or crude petroleum the taxes imposed 
under the provisions of this Act; but, if collection is in crude 
petroleum, such transporter is authorized and empowered to 
sell the same, and pay said taxes by check or cash to the 
State Tax Commission or sheriff, as provided in this Act. 

Report Blanks. 

Sec. 8. The State Tax Commission may require reports on 
blanks prepared by it from all producers and transporters of 
crude petroleum, in addition to the reports above provided for. 
as it may deem necessary from time to time. 

Penalty for Failure to Report or Pay. 

Sec. 9. Any person, firm, corporation or association, required 
to make reports or collect and pay the taxes hereunder, failing 
to pay such taxes, penalty or interest, after becoming delinquent 
or failing to make any report, required by this Act, for thirty 
• lays after the date upon which the same is required by this Act 
to be made; or failing for thirty days after engaging in the 
transportation of crude petroleum, as set out herein, to register 



U4(i MORRISON'S OIL RIGHTS 

as required hereby, shall be deemed guilty of a misdemeanor, 
and on conviction shall be fined fifty dollars ($50.00) for each 
day of such failure, to be recovered by indictment or civil ac- 
tion, and a false report shall be deemed as a failure to report 
under this Act. Approved March 29, 1918 Laws, p. 540. 

Act Regulating Common Carriers 

An Act regulating the transportation, delivery, and nonlia- 
bility of common carriers by pipe line of crude petroleum or 
gas. 

Limiting Liability of Oil and Gas Carriers. 

Sec. 1. That all persons, firms, corporations, and associations 
engaged in the business of transporting crude petroleum or 
gas by pipe line as a common carrier, may accept for trans- 
portation such oil or gas as is offered to it for that purpose 
from the party or parties in possession, and shall redeliver the 
same upon the order of the consignor unless prevented by an 
order of some court of competent jurisdiction, and such de- 
livery shall be made without liability on the part of such car- 
rier to the true ow r ner out of possession except from the time 
such order of court is served upon it in the same manner that 
summons is now required to be in civil actions. 

Sec. 2. It appearing that a great demand for this legislation 
now exists for the protection of the oil industry, of the State, 
an emergency is hereby declared to exist, and this act shall 
become effective upon its passage and approval. Approved 
March 18, 1920, Acts of 1920, p. 109. 

Act Concerning Contracts and Leases 

An Act to standardize, validate, define and enforce contracts 
and leases for lands leased for oil and gas purposes and to pro- 
vide for how and when offset wells shall be drilled. 

Tender of Delay Rentals. 
Sec. 1. Whenever, in any lease of lands for oil and gas pur- 



STATE STATUTES 647 

• 

poses, it is provided in substance that actual drilling or de- 
velopment may be postponed by the payment or tender of 
rentals on or before the date fixed in said lease for such pay- 
ment or tender, if the lessee or assignee of said lessee shall fail 
to pay or tender said rents on or before the date stipulated in 
the lease, or contract to pay, then said lease or contract shall 
be void, unless the lessor thereafter, and before executing a 
new lease or contract, shall accept said rentals. 

Sec. 2. That all valid, existing or future contracts and 
leases for oil and gas rights upon and under the lands of this 
Commonwealth, wherein by their terms a rental clause is pro- 
vided in event of failure to drill for oil or gas within a given 
period, are hereby validated and declared to be, and shall be, 
construed by the courts of this Commonwealth enforcible and 
binding contracts according to the terms thereof between the 
parties so long as the rentals therein provided shall be paid or 
tendered at and as provided by their terms during the period 
of said lease and contract. 

Dry Well. Second Well. 

Sec. 3. That the drilling of one nonproductive well shall be 
sufficient consideration for the discharge of rentals for holders 
of said contract and lease for a period of twelve months after 
its completion, and at the expiration of which time another 
well shall be commenced or rentals renewed as per said lease 
or contract, and if lessor fails to commence a well or renew 
payments of rentals said lease shall automatically expire and 
become null and void. 

Protection Wells. 

Sec. 4. That in the event of oil or gas being discovered in 
paying quantities on an adjoining leasehold and the products 
therefrom being taken out of the ground and marketed and 
said well is within two hundred feet of another lessor's prop- 
erty line, then within three months after written notice lias 
been given lessee to the effect that such oil or gaa has com- 
menced to be transported off and marketed from the said ad- 



648 MORRISON'S OIL RIGHTS 

joining premises the lessee or lessees of the land lying within 
two hundred feet of the said wells shall begin to drill an offset 
well to each of such wells so located, provided said offset wells 
to be drilled are not less than five hundred feet of each other, 
and upon his failure to so commence said offset well and com- 
plete same with diligence the said contract and lease shall 
automatically expire and become null and void. Provided this 
shall not apply to leases that are being operated, or on which 
wells are being drilled. 

Sections 5 and 6 are the repeal and emergency clauses. Ap- 
proved March 18, 1920, Acts of 1920, p. 110. 

Act Regulating Transportation in Pipe Lines 

An Act relating to oil and natural gas; regulating the re- 
ceipt of same into pipe lines, and the transportation and de- 
livery thereof to consumers. 

Pipe Line Shipments, a Public Use. 

Sec. 1. Every company or corporation receiving, transport- 
ing or delivering a supply of oil or natural gas for public con- 
sumption is hereby declared to be a common carrier, and the 
receipt, transportation and delivery of natural gas into, through 
and from a pipe line operated by any such company is declared 
to be a public use. 

Duty to accept Shipments. 

Sec. 2. It shall be the duty of each and every company 
engaged in the receipt, transportation or delivery of oil or 
natural gas for public consumption at all reasonable times to 
receive, for transportation and delivery, from such pipes as 
may be connected up with any main or tributary line, all gas 
that may be held and stored or ready for delivery, provided, 
however', that said main or tributary line has the means or 
capacity to so receive, transport or deliver such oil or gas as 
is offered. 



STATE STATUTES 649 

Proportionate Deliveries. 

Sec. 3. In the event that any main line or tributary thereto or 
both, is operating and transporting to such capacity as that. 
it is impossible or impracticable to receive or transport all 
offered oil or gas, where connections exist, then it shall be the 
duty of the operating company to receive and transport of- 
fered oil or gas in equal proportions, using the daily produc- 
tive quantity of each producing person or company so offering- 
gas as the basis of proportion. 

Penalty and Damages. 

Sec. 4. Any wilful refusal or failure to receive, transport 
and deliver oil or gas in the manner set out above, shall be 
deemed a misdemeanor, and upon conviction, the company so 
failing or refusing shall be fined not less than one [ hundred 
nor more than five hundred dollars, and each day's willful 
failure or refusal shall be deemed to be a separate offense, and 
in addition said failing or refusing company shall be liable in 
damages to the injured party. 

Sec. 5. This law to become effective upon its passage and ap- 
proval, and in due course of law. Neither approved nor dis- 
approved by the Governor. Acts of 1920 p. 613. 

Powers of Railroad Commission Extended. 

An Act approved March 22, 1920, Acts page 250 extends the 
power of the railroad commission over natural gas companies 
and natural gas transportation companies. 



LOUISIANA. 

(Act of 1910) 

Department of Mining and Minerals Established. 

Sec. 1. Be it enacted by the General Assembly of the State 
of Louisiana, That there be and is hereby established a De- 



(350 MORRISON'S OIL RIGHTS 

partment of Mining' and Minerals, including' gas and oil, to 
consist of the register of the State Land Office, who shall he 
ex-officio supervisor of minerals, and one deputy supervisor 
of minerals, who shall be a person having a practical knowledge 
of geology, and natural gas, and oil, and who shall be appointed 
and commissioned by the governor, on the recommendation of 
the conservation Commission, for the period of one year at a 
time ; provided the ex-officio supervisor of minerals shall re- 
ceive as compensation for the performance of his duty imposed 
on him by this Act, five hundred dollars per annum ($500.00), 
and the deputy supervisor and such assistants as may be pro- 
vided to be compensated as hereinafter provided, all to be paid 
from the conservation fund, the supervisor on his own warrant. 
Act July 7, 1910, p. 423. 

(The general provisions of this section have been superseded 
by Act 127 of 1912, placing all mineral resources under the 
Department of Conservation.) 

Duty of Supervisor to Enforce Laws and Make Reports. 

Sec. 2. That the supervisor of minerals shall make inspection, 
either in person or through the deputy supervisor, of all mining 
operations carried on in this State, particualrly that of the 
production of natural gas and oil, so far as practicable, and 
shall see that every precaution is taken to insure the health and 
safety of workmen engaged in mining. He shall see that all 
the provisions of law pertaining to mining now in force, or here- 
after enacted, particularly those provisions pertaining to the 
drilling of wells and piping and consumption of natural gas 
and oil, are faithfully carried out, and that the penalties of law 
arc strictly enforced against any person or persons who violates 
the same. 

He shall make an annual report to the conservation Com- 
mission on the first Monday in April of each year, tabulating 
Hie number and character of mining operations being carried 
on in this State, with location and annual production, both in 
quantity and value; a record of the geological strata passed 
through in drilling gas and oil wells ; the depth at which salt 



STATE STATUTES 



651 



water is reached in the various wells and the height to which 
it rises so far as practicable. 

He shall report the volume of gas and oil produced by each 
well, and also the initial or rock pressure of the same; the in- 
crease or decrease in pressure of the various wells so far as jt 
can be ascertained, and also the increase or decrease in value 
of gas produced .in gas wells ; the number of miles of mains 
laid for the transportation of gas and oil and capacity and 
course of the same; the amount of capital invested in the oil, 
gas and other mining industries ; and the number of persons em- 
ployed in the same; the amount of capital invested in manu- 
factures located on account of natural gas and oil and other 
minerals, and the number of employees, and other facts or in- 
formation as the conservation Commission may require. Id. 

Deputy Supervisor. 

Sec. 3. That there shall be appointed by the governor, upon 
the recommendation of the conservation Commission, a person 
having a practical knowledge of geology and natural gas and 
oil, and who is not directly or indirectly interested in mining or 
in piping or selling natural gas and oil, as deputy supervisor 
of minerals of the State of Louisiana. 

His duty shall be as herein prescribed for the supervisor of 
minerals, and he shall be the chief assistant under the supervi- 
sion of the supervisor of minerals, in carrying out the mining 
policy of the State. Within ten (10) days after he shall have 
been commissioned he shall make and execute a bond in the sum 
of twenty-five hundred dollars ($2,500.00), payable to the gover- 
nor of Louisiana, which bond shall be for the faithful perform- 
ance of duty and shall be approved and filed with the Secretary 
of State. Such deputy supervisor shall devote all his time to 
the business of supervision of mining. 

He shall receive a salary of two thousand dollars ($2,000.00) 
per annum, and under the supervision of the supervisor of min- 
erals shall have an allowance not exceeding one thousand dol 
lars ($1,000.00) per year for office and traveling expenses for 
himself and such assistants as may be hereinafter provided, 



652 MORRISON'S OIL RIGHTS 

which sum shall he paid from the conservation fund upon his 
warrant, countersigned by the supervisor of mining. Id. 

Inquisitorial Powers of Deputy Supervisor. 

Sec. 4. That it shall be the duty of the deputy supervisor 
of minerals to inspect all mining operations carried on in the 
State, and he shall have the power to prohibit any such opera- 
tions as he may deem unsafe or dangerous to life or property 
ot wasteful of natural resources ; reserving a right of appeal by 
the operator, or operators, or owners, to the conservation Com- 
mission for ten (10) days if notified by such operator or opera- 
tors, or owner, to the supervisor at the time they shall receive 
notice to cease operation. 

And any person or persons carrying on any such operations 
prohibited shall be guilty of a misdemeanor and upon convic- 
tion shall pay a fine in any Court having jurisdiction of such 
misdemeanor in a sum of not exceeding one thousand dollars 
($1,000.00), or shall be imprisoned in the parish jail a period 
not exceeding six months at the discretion of the Court ; and 
any person or persons in this State owning mines or carrying- 
on mining operations, or who contracts the same, who refuses 
to allow the same to be inspected by the supervisor of minerals, 
upon conviction shall be fined in a sum not exceeding five hun- 
dred dollars ($500.00) ; Provided, further. That whenever any 
responsible person shall file with the supervisor of minerals an 
affidavit charging the owner or owners, or operators of such 
mines, or gas and oil wells, or their employees with the violation 
of any of the laws regulating mining, or the production of natu- 
ral oil and gas, and particularly specifying the violation com- 
plained of, it shall be the duty of the supervisor to examine and 
inquire into the alleged violation of the law, as set forth in the 
affidavit, and if he finds the facts as charged it shall be his 
duty to see that the law is complied with. 

He shall have, and is hereby invested with authority to inquire 
if all person or persons engaged in mining operations subject to 
a license tax have procured license and when he shall find any 
operating without license he shall report the same to the super- 



STATE STATUTES - 6f$ 

visor of minerals, who shall proceed according to law to enforce 
the license tax collections. Id. 

(Act of 1911) 



Abandoned Wells Must Be Plugged ; Provisions for Shot Wells. 

1. Be in enacted by the General Assembly of the State of 
Louisiana, That whenever any well shall have been sunk for 
the purpose of obtaining natural gas or oil or exploring for the 
same, and shall be abandoned or cease to be operated for utiliz- 
ing the flow of gas or oil therefrom, it shall be the duty of any 
person, firm or corporation having the custody or control of such 
well at the time of such abandonment or cessation of use, and 
also of the owner or owners of the land wherein such well is 
situated, to properly and securely stop and plug the same as 
follows: If such well has not been "shot" there shall be placed 
in the bottom of the hole thereof a plug of well-seasoned pine 
wood, the diameter of which shall be within one-half inch as 
great as the hole of such well, to extend at least three feet above 
the salt water level, where salt water has been struck such plug 
shall extend at least three feet from the bottom of the well. In 
both cases such wooden plugs shall be thoroughly rammed down 
and made tight by the use of drilling plugs. After such ramming 
and tightening the hole of such well shall be filled on top of 
such plug with finely broken stone or sand, which shall be well 
rammed to a point at least four feet above the gas or oil-bearing 
rock; on top of the stone or sand there shall be placed another 
wooden plug at least five feet" long with diameter aforesaid, 
which shall be thoroughly rammed and tightened. In case such 
well has been "shot" the bottom of the hole thereof shall be filled 
with a proper and sufficient mixture of sand, stone and dry 
cement, so as to form a concrete up to a point at least eight feet 
above the top of the gas or oil-bearing rock or rocks, and on 
top of this filling shall be placed a wooden plug at least six 
feet long, with diameter as aforesaid, which shall be properly 
rammed as aforesaid. The casing from the well shall then be 
pulled or withdrawn therefrom, and immediately thereafter 



654 MORRISON'S OIL RIGHTS 

a cast-iron ball, eight inches in diameter, shall be dropped in 
the well, and securely rammed into the shale by the driller or 
owner of the well, after which not less than one cubic yard of 
sand pumping or drilling taken from the well shall be put on 
top of said iron ball. Act 1911, p. 313. 

Escape of Gas or Oil to Be Stopped in Two Days. 

2. That it shall be unlawful for any person, firm or corpora- 
tion having possession or control of any natural gas or oil well, 
whether as a contractor, owner, lessee, agent or manager, to 
allow or permit the flow of gas or oil from any such well, to 
escape into the open air, without being confined wiithin such 
well or proper pipes, or other safe receptacle, for a period longer 
than two (2) days, next after gas or oil shall have been struck 
in such well, and thereafter all such gas or oil shall be safely 
and securely confined in such wells, pipes or other safe and 
proper receptacles; Provided, That this law shall not apply to 
any well that is being operated for the production of oil and 
in which the oil produced has a higher salable value in the field 
than has the gas so lost. Id. 

Supervisor of Minerals Authorized to Prescribe Regulations. 

3. That the supervisor of minerals shall have, and he is here- 
by invested with, authority to prescribe regulations for the bor- 
ing of oil and gas wells, to the end that blow-outs, and gas waste, 
shall be avoided, which regulations shall be followed by diallers. 
Id. 

Penalty. Misdemeanor. 

1. That any person, firm or corporation, violating the provi- 
sions of sections 1 and 2 of this Act or any reasonable regulations 
provided by the supervisor of minerals, shall be guilty of a mis- 
demeanor, and upon conviction thereof shall be fined in any sum 
not exceeding five hundred dollars ($500.00), or shall be im 
prisoned for a period not exceeding three months, in the discre- 
tion of the Court. Id. 



STATE .STATUTES 655 

Adjacent Owners May Close, Pack and Tube. 

5. That whenever any person, or corporation in possession or 
control of any well in which natural gas or oil has been found 
shall fail to comply with the provisions of this Act, any person 
or corporation lawfully in possession of lands situated adjacent 
to or in the vicinity or neighborhood of such well may enter 
upon the, lands upon which such well is situated and take pos- 
session of such well from which gas or oil is allowed to escape 
in violation of the provisions of sections 1 and 2 of this Act, and 
pack and tube such well and shut in and secure the flow of gas 
or oil, and maintain a civil action in any Court of competent 
jurisdiction in this State against the owner, lessee, agent or 
manager of said well, and each of them jointly and severally, 
to recover the cost and expenses of such tubing and packing, to- 
gether with attorney's fees and costs of suit. This shall be in 
addition to the penalties provided by section 4 of this Act. Id. 

(Act No. 283 of 1910) 

Wild Gas Well, How Closed. 

Section 1. Be it enacted by the General Assembly of the State 
of Lousiana, That in order to protect the natural gas fields of 
this State, it is hereby declared to be unlawful and a nuisance 
for any person, firm or corporation to negligently permit or 
suffer any natural gas well to go wild or become uncontrollable 
or wastefully burn and the owner or proprietor or person in 
possession of any wild, uncontrollable or wastefully burning 
natural gas well, shall close the same and securely cap it or plug 
it or otherwise prevent the escape and waste or wasteful burning 
of natural gas therefrom, after five (5) days' written notice to 
such owner or proprietor or person in possession to do so; such 
notice to be given by any person having an interest in stopping- 
such wild, uncontrollable, wasteful or wastefully burning natu- 
ral gas well ; or such notice may be given by any constable or jus- 
tice of the peace of the parish where such wild or uncontrollable 
or wasteful or wastefully burning natural gas well may be lo 
cated, or the demand of any person having an interest in the 
stopping of the same. Act No. 283 of 1910. 



656 MORRISON'S OIL RIGHTS 



Governor to Confiscate Wild Well. 



Sec. 2. That whenever such owner or proprietor or person in 
possession of such wild, or uncontrollable, wasteful or wastefully 
burning" natural gas well, shall be notified to close, cap or plug 
the same, or otherwise prevent the escape and waste or wasteful 
burning of natural gas therefrom, he shall in good faith com- 
mence the work of so closing or capping or plugging. the same 
in order to prevent the escape and waste or wasteful burning 
of natural gas therefrom, within five (5) days from the date of 
the receipt of such notice as provided for in the first section 
of this Act; and in the event that the owner or proprietor oi 
person in possession of such natural gas well fails, refuses or 
neglects to close, plug or cap the same or otherwise prevent the 
escape and waste or wasteful burning of natural gas or com- 
mence in good faith the work of doing so within five (5) days 
from the receipt of such notice, the Governor, on the written 
complaint of any person, firm or corporation having an interest 
in the stopping, plugging or closing of such naatural gas well, 
shall direct the Board of State Engineers to take charge of the 
work of closing such wild or uncontrollable or wastefully burning 
natural gas well, and the Board of State Engineers shall then 
proceed at once to cap or close or plug the same or otherwise 
prevent the wasteful escape or wasteful burning of natural gas 
from such well, at the expense of the owner or proprietor there- 
of ; and to secure to the State the cost and expense of such clos 
ing, capping or plugging of such well, possession of the same, 
with sufficient ground adjacent thereto, it belonging to such 
owner or proprietor, with the rents, revenues and incomes there- 
from, shall be retained by the State until the full and final pay- 
ment of such costs and expense shall be reimbursed to the State, 
and when such owner or proprietor or person in possession of 
such well shall pay such cost or expense to the State, less the 
revenues, rents and incomes derived therefrom by the State 
while the same was in possession of the State, the State shall 
restore possession of said well to him provided, in the event that 
the rents, revenues, and incomes shall not be sufficient to reim- 
burse the State as provided for in this section, then and in that 



STATE STATUTES ().">< 

such wild, uncontrollable or wasteful natural gas well, shall op- 
erate as a lien and privilege upon all of the property of what- 
soever nature of the owner of the said wild well, and the State 
shall proceed to enforce said lien and privilege by suit before 
any Court of competent jurisdiction, the same as in other like 
civil actions, and the judgment so obtained shall be executed 
in the same manner as now provided by law. If the property so 
seized and sold brings an amount in excess of the cost and ex- 
pense occasioned by the State as provided in this section; then 
and in that event such excess or balance shall be paid over to the 
owner of such wild gas well. Id. 

Misdemeanor to Allow Well to Go Wild. 

Sec. 3. That it shall be a misdemeanor for any person to wil- 
fully and intentionally set fire to any natural gas well or neg- 
ligently permit or suffer any natural gas well owned by him or 
under his management and control or in his possession, to catch 
on fire or go wild or become uncontrollable, or to negligently 
permit or suffer natural gas to wastefully escape or wastefully 
burn therefrom: and on conviction thereof shall be fined in a 
sum not less than five hundred dollars ($500.00) or imprison- 
ment of not less than three (3) months or both, at the discre- 
tion of the Court. Id. 

Misdemeanor to Injure Pipe Line. 

Sec. 4. That any person who shall intentionally or wilfully 
injure or damage the property, pipes, pipe lines or mains of any 
natural gas well belonging to or operated by any natural gas- 
producing company, or who shall wilfully or intentionally divert 
the gas from any pipe, main or natural gas well, the property of 
any such natural gas-producing company, shall be deemed guilty 
of a misdemeanor and on conviction thereof shall be fined in the 
sum of not less than one hundred dollars ($100.00) or imprison- 
ment of not less than thirty (30) days or both, at the discretion 
of the Court. Id. 
M. O. R.— 42. 



058 MORRISON'S OIL RIGHTS 

Misdemeanor to Fail to Plug. 

Sec. 5. That it shall be unlawful for any individual, firm or 
corporation to abandon any well in or adjacent to a natural gas 
field or an apparent natural gas field, without first placing a 
wooden plug, properly made, both above and below the gas- 
producing sand, to prevent the admission of water into the gas 
producing sand or otherwise sufficiently securing such well 
against the admission of water into the gas-producing sand ; and 
whenever any individual, firm or corporation shall abandon such 
well without first plugging or securing the same as provided, 
to prevent the admission of water into the gas-producing sand, 
he shall be deemed guilty of a misdemeanor, and on conviction 
thereof shall be subject to a fine of not less than one hundred 
dollars ($100.00) nor more than one thousand dollars ($1,000.- 
00) or imprisonment of not less than thirty (30) days nor more 
than four (4) months, or both, at the discretion of the Court. 
Id. 

Act Applies to All Gas Wells. 

Sec. 6. That the provisions of this Act shall apply to any gas 
well or wells which may be bored or drilled in, near to or ad- 
jacent to any natural gas field or to any apparent natural gas 
field and to any such well or wells which have heretofore already 
been bored or drilled. Id. 

(Act No. 145 of 1916) 

License Tax on Operators. 

Sec. 1. Be it enacted by the General Assembly of the State 
of Louisiana, That there is hereby levied a license tax for. the 
year 1916, and for each subsequent year, upon each person or 
association of groups, firms or corporations pursuing the busi- 
ness of severing natural products, including all forms of tim- 
ber, turpentine and minerals, including oil, gas, sulphur and 
salt; from the soil; to be collected quarterly by the Tax Col- 
lectors as hereinafter set forth, the license for each quarter to 



STATE STATUTES 659 

be based on the amount severed in the preceding quarter. Act 
1916, No. 145. 

Quarterly Statements Required. 

See. 2. Be it further enacted, etc., That every such person, 
firm, association or corporation engaged within the State in the 
business of severing timber, turpentine, oil, gas, sulphur and 
salt, from the soil, shall, within thirty days after the expiration 
of each quarter annual period expiring respectively on the last 
day of September, December, March and June of each year, 
file with the State auditor a statement under oath, on forms 
prescribed by him, of the business conducted by such person, 
firm, association or corporation during the last preceding quar- 
ter annual period, showing the nature of the natural products 
so produced, and the gross amount thereof, the actual cash 
value thereof, and any such information pertaining thereto as 
the State Auditor may require, and in the case of a mine or gas 
or oil well, including sulphur and salt, showing the location of 
each saw mill, timber camp or turpentine camp, or of each mine 
or farm, tract or lot of land upon which the wells that are ac- 
tually producing oil, sulphur, salt or other minerals are located ; 
also giving the number of actually producing gas wells on each 
farm, tract or lot from which said person, firm, association or 
corporation is selling gas, either for domestic use, manufactur- 
ing purposes or making a business of selling it for any purposes 
whatever. At the time of rendering the said report the said 
person, firm, association or corporation shall at the same time 
pay to the Tax Collector of the parish where said product is 
taken or severed from the soil, a little license to operate in each 
succeeding quarter, fixed upon the amount of production of the 
preceding quarter, as follows : 

Two and one-half cents (2^) per one thousand (1,000) feet 
for severing oak and ash timber; four (4) cents per one thou 
sand feet for severing cypress timber; two (2) cents per one 
thousand (1,000) feet for severing all other kinds of timber: 
three-fourths (f) of one (1) cent per barrel for severing oil: 
ten (10) cents per ton for severing sulphur; two (2) cents per 
ton for severing salt; and one (1) cent per barrel for severing 



660 MORRISON'S OIL RIGHTS 

turpentine; one fifth (£) of one (1) mill per one thousand 
(1,000) cubic feet for severing gas. 

The making of said reports and the payment of said licenses 
shall be by those actually engaged in the operation of severing, 
whether it be the owner of the soil, or a lessee who is severing 
from the soil of another, or the owner of any such resources 
severing from the soil of another. In all cases where any timber 
is purchased after the same has been severed from the soil, tjie 
purchaser thereof shall make report of the amount and the 
name of the owner from whom purchased, to the tax collector, 
in order that the tax collector may collect the license from the 
seller of the timber. Such seller of the timber, after it is sev- 
ered from the soil, shall also make report to the Tax Collector 
and the auditor, and pay the license as herein provided. Id. 

State Auditor May Demand Information. 

Sec. 3. That the State auditor shall have the power to require 
any such person, firm, association or corporation engaged in sev- 
ering all such natural products from the soil to furnish any 
additional information deemed by him to be necessary for the 
purpose of computing the amount of said tax and for said pur- 
pose to examine the books, records and files of such person, firm, 
association or corporation; and to that end shall have power to 
examine witnesses, and if any such witnesses shall fail or re- 
fuse to appear at the request of the State auditor, said auditor 
shall certify the facts and the name of the witness so failing and 
refusing to appear to the district Court of the State having 
jurisdiction of the party, and said Courts shall thereupon issue 
a summons to the said party to appear and give such evidence as 
may be required, for the purpose of ascertaining whether or not 
any return so made is the true and correct return of the gross 
receipts of any such person, firm, association or corporation, 
and whenever it shall appear to the State auditor that any such 
person, firm, association or corporation engaged in severing such 
natural products from the soil has unlawfully made an untrue 
or incorrect return of its gross receipts, as made hereinbefore 
provided, he shall ascertain the correct amount of such gross 
receipts and shall compute said tax on same. Id, 



STATE STATUTES Ml 

Date of Delinquency. Additional Taxes May Be Levied. 

Sec. 4. That the tax provided for by this Act shall become 
delinquent after the date fixed for each quarter-annual report 
to be filed in the office of the State auditor and from such time 
shall, as a penalty for such delinquency, be subject to similar 
penalties to those provided in the general license laws of this 
State; and the payment of the license tax exacted by this Act 
shall be in addition to and shall not affect the liability of the 
parties so taxed for the payment of air State, municipal, district, 
parochial and special taxes upon their real estate and other 
corporeal property; but no other tax in addition hereto shall be 
imposed upon rights to produce in this State those things whose 
production is subjected to a license tax by the provisions of this 
Act; except that where the police juries of the several parishes 
of the State are authorized by existing laws to levy a tax upon 
the business of severing any of the natural products affected 
by this Act that such police juries may continue to levy such 
license tax provided that same shall in no case exceed one-half 
of the amount levied herein for the State. Id. 

State Auditor to Make Inquisition. 

Sec. 5. That if any person, firm, association or corporation 
shall fail to make a report of the gross production of its natural 
products, upon which the license is herein provided for, within 
the time prescribed by law for such report, it shall be the duty 
of the State auditor to examine the books, records and files of 
any such person, firm, association or corporation to ascertain 
the amount and value of such production and to compute the 
tax thereon as provided herein, and shall add thereto the cost 
of such examination, together with any penalties accruing there- 
from, and to this end he may call upon the supervisor of public 
accounts to assist in such investigation. Id. 

Sheriff to Collect. 

Sec. 6. That when any tax provided for in this Act shall be 
come delinquent, the State auditor shall issue an order directed 



»)()!> MORRISON'S OIL RIGHTS 

to the sheriff of any parish wherein the same, or any part there- 
of, accrued, and the sheriff to whom said order shall be directed 
shall proceed against the property, assets and effects of the per- 
son, firm, association or corporation against whom said tax is 
assessed in the same manner as he is authorized by the general 
license law to proceed in the collection of delinquent licenses; 
collecting penalties as prescribed in general laws. Id. 

Perjury to Make False Report. 

Sec. 7. Be it further enacted, etc., That any person who shall 
intentionally make any false oath to any report required by the 
provisions of this Act shall be deemed guilty of perjury and 
shall be subject to all penalties prescribed for said crime. Id. 

Sections 8-11 refer to use of the funds collected and other 
.matters of indifference to oil operators. 

(Act of 1917) 

Proof of Forfeit of Lease to Be Recorded. 

Section 1. When an oil, gas or other mineral lease heretofore 
or hereafter executed shall become forfeited, it shall be the duty 
of the lessee, his successor or assigns, within sixty days from 
the date this Act shall take effect, if the forfeiture occurred 
prior thereto and within sixty days from the date of the for- 
feiture of any and all leases to have such lease released from 
record in the county where the land is situated without cost 
to the owner thereof. Act 1917, p. 24. 

Damages for Failure to Release. 

Sec. 2. Should the owner of such lease neglect or refuse to 
execute a release as provided in this Act, then the owner of the 
leased premises may sue in any Court of competent jurisdiction 
to obtain such release, and lie may also recover in such aeticfri 
of the lessee, his successor or assigns the sum of one hundred 
dollars damages and all costs, together with a reasonable attor- 
ney's fee for preparing and prosecuting the suit, and he may 



STATE STATUTES 66'> 

also recover any additional damages that the evidence in the 
ease will warrant. In all such actions writ of attachment may 
issue as in other cases. Id. 

Written Demand to Release. 

Sec. 3. At least twenty days before bringing the action pro- 
vided for in this Act, the owner of the leased land, either by 
himself or by his agent or attorney, shall demand of the holder 
of the lease (if such demand by ordinary diligence can be made 
in this State) that said lease be released of record. Such de- 
mand must be written. When written a letterpress or carbon 
or written copy thereof, when shown to be such, may be used 
as evidence in any Court, with the -same force and effect as the 
original. Id. 

Well to Be Cased against Salt Water. 

Section 1. That the owner or operator of any well put down 
for the purpose of exploring for and producing oil or gas shall, 
before drilling into the oil or gas- bearing rock, encase the well 
with good and sufficient wrought iron oil well casing from the 
lower part of such well, and from penetrating the oil or gas 
bearing rock. Should any well be put down through the first 
into a lower oil or gas-bearing rock, the same shall be cased in 
such manner as will exclude all salt water from both upper and 
lower oil or gas-bearing rocks penetrated. Act 1917, p. 46. 

Abandoned Wells to Be Plugged. 

Sec. 2. The owner of any well, when about to abandon or 
eease operating the same; for the purpose of excluding all fresh 
or salt waters from penetrating the oil or gas bearing rock or 
rocks, and before drawing the easing, shall fill the well with 
sand or rock sediment to the depth of two feet below the top 
of each oil or gas bearing rock, and drive therein a round, sea- 
soned, wooden plug two feet in length, and in diameter equal 
to the full diameter of the well below the casing and imme- 
diately upon drawing the casing, shall fill in on top of such plug 
with sand or rock sediment to a depth of five feet, and again 



664 MORRISON'S OIL RIGHTS 

drive into the well a round, wooden plug three feet in length, 
the lower end tapering to a point, and to be of the same diame- 
ter at the distance of eighteen inches from the smaller end as 
the diameter of the well below the point at which it is driven; 
and after such piling has been driven, the well shall be filled 
with sand or rock sediment to the depth of twenty feet. Id. 

Penalty. 

Sec. 3. Any owner or operator or person who shall violate 
any of the provisions of this Act shall be deemed guilty of a 
misdemeanor, and shall be fined in the sum of not less than one 
hundred dollars nor more than five hundred dollars for each and 
every offense, and for a second violation of any of the provisions 
of the preceding sections of this Act, shall be fined in a sum of 
not less than one hundred dollars nor more than five hundred 
dollars, or imprisonment in the county jail for not less than 
thirty days nor more than six months, or both such fine and 
imprisonment. Id. 

Act Defining Waste of Natural Gas 

(Act 268 of 1918) 

Section 1. Be it enacted by the General Assembly of the State 
of Louisiana. That it shall be unlawful to permit the waste of 
natural gas, or to use natural gas for any purpose whatsoever 
in such maimer as will threaten with premature exhaustion, 
extinction or destruction the common supply or common reser- 
voir from which said natural gas is drawn. 

Definitions of Waste. 

See. 2. That the term waste as above used in addition to its 
ordinary meaning, shall include : 

(a) Wantonly or wilfully permitting the escape of natural 
gas in commercial quantities into the open air. 

(b) The intentional drowning with water of a gas stratum 
capable of producing gas in commercial quantities. 

(c) Underground waste. 

(d) Permitting of any natural gas well to wastefully burn. 



STATE STATUTES 665 

Power and Authority of Department. 

Sec. 3. That the Department of Conservation is granted full 
power and authority to prevent the waste of natural gas, or the 
rise of natural gas for any purpose whatsoever in such quantities 
as will threaten with premature exhaustion, extinction or de- 
struetion the common supply or common reservoir from which 
said natural gas is drawn by preventing the flow during each 24 
hours from any well of more than twenty-five per cent of the 
potential capacity thereof, and it is made the imperative duty 
of the said Department of Conservation to make frequent in- 
spection and investigation of the natural gas fields of the State 
so as to carry out the provisions of this Act, and if any waste 
or use of natural gas in quantities to threaten with premature 
exhaustion, extinction or destruction the common reservoir from 
which the natural gas is being drawn is found to exist as waste 
and the undue use of natural gas has heretofore been defined, 
the said Department shall proceed at once to prevent or stop 
the waste or improper use of such natural gas ; and to carry out 
the provisions of this Act and existing laws the Department of 
Conservation is empowered to sue out an injunction without 
giving bond in any of the District Courts of the State to prevent 
and prohibit the said waste of natural gas or the use or manner 
of use of natural gas in such quantities as to threaten with 
premature exhaustion, extinction or destruction the common 
source or reservoir from which said natural gas is being drawn 
as waste, and the undue use of natural gas has heretofore been 
defined; and in all such proceedings it shall be the duty of the 
Attorney General of Louisiana to appear in behalf of said De- 
partment, which injunction shall not be dissolved on bond. 

Pumps and Compressors Regulation. 

Sec. 4. That there is hereby granted to and vested in the De- 
partment of Conservation the power to regulate the use of 
pumps, compressors and other artificial or injurious means of 
increasing the natural flow. 



666 Momusox's oil rights 

Must Make Semi-annual Reports. 

Sec. 5. That every person, association, partnership or corpo- 
ration engaged in selling natural gas or using natural gas in the 
manufacture of any article of commerce, or for fuel in manufac- 
turing enterprises, shall make semi-annual reports under oath to 
the Department of Conservation upon blanks to be furnished by 
the Department showing the manner of use and quantities of 
natural gas used or sold as aforesaid. 

Semi-annual Report by Department. 

Sec. 6. That the Department of Conservation shall make a 
full and complete report semi-annually to the Governor of the 
situation in the various natural gas fields within the State, and 
shall likewise file with the President of the Police Jury of each 
Parish within which natural gas is produced a statement show 
ing the situation concerning the present and future supply of 
natural gas within such year. 

Duty of District Judges. 

Sec. 7. That it shall be the duty of the District Judges in " 
those Parishes wherein natural gas is produced or found, to 
charge Jhe grand juries to inquire into the waste of natural gas 
or the use being made of natural gas for any purpose whatso- 
ever that is threatening with premature exhaustion, extinction 
or destruction the common source or reservoir from which said 
natural gas is being drawn, as waste and the undue use of nat 
ural gas has heretofore been defined. 

Penalties. 

Sec. 8. That each violation of this Act shall be punished by 
a fine of not less than one hundred dollars nor more than five 
hundred dollars, or by imprisonment for not less than thirty 
days nor more than sixty days, or both in the discretion of the 
Court, and in default of the payment of the fine imposed by im- 
prisonment for an additional time not exceeding six months, 
and each day this Act is violated shall constitute a separate of- 



STATE STATUTES GG7 

fensc hereunder after written notification given to the offender 
by authority of the said Department of Conservation. 

Sec. 9. That this Act shall not repeal the existing laws on this 
same subject matter unless the same are inconsistent with the 
provisions of this Act. 

Act for Protection of Source of Supply of Natural Gas 

(Act 270 of 1918) 

Section 1. Be it enacted by the General Assembly of the 
State of Louisiana, That, in order to further conserve the nat- 
ural gas in the State of Louisiana, whenever the full production 
from any common source of supply of natural gas in this State 
is in excess of the market demands, then any person, firm, corpo- 
ration having the right to drill into and produce gas from any 
such common source of supply, may take therefrom on\y such 
proportion of the natural gas that may be marketed without 
waste, as the natural flow of the well or wells owned or controlled 
by any such person, firm or corporation bears to the total flow 
of such common source of supply having due regard to the 
acreage drained by each well, so as to prevent any such person, 
firm or corporation, securing any unfair proportion of the gas 
therefrom ; provided that the Conservation Commission of Loui- 
siana may by proper order, permit the taking of a greater 
amount whenever it shall deem such taking reasonable or equita- 
ble. 

Offering Gas for Sale. 

Sec. 2. That every person, firm or corporation, now or here- 
after engaged in the business of purchasing and selling natural 
gas in this State, shall be common purchaser thereof, and shall 
purchase all of the natural gas which may be offered for sale 
which may be brought in pipes and connecting lines by the own- 
er or proposed seller to its trunk lines, at the seller's expense, or 
to its gathering lines, without discrimination in favor of one 
producer as against another, or in favor of any one source of 



1568 MORRISON'S OIL RIGHTS 

gupply as against another save as authorized by the Conserva- 
tion Commission of Louisiana after due notice and hearing, but 
if any such person, firm or corporation shall be unable to pur- 
chase all the gas so offered, then it shall purchase natural gas from 
each producer ratably, and any common purchaser of gas shall 
have the same right to purchase the product of any gas well or 
wells that are not being utilized under the conditions of this 
Act ; and in the event the owner of said well or wells refuses to 
sell, the common purchaser shall have the same rights of action 
against such owner or owners as the seller has against the com- 
mon purchaser who refuses to buy, and the seller so refusing to 
sell shall be subject to the same penalties — etc., provided against 
the common purchaser who refuses to buy. This Act shall not 
affect in any way a municipal corporation engaged in buying 
and selling natural gas, or any corporation that builds or main- 
tains a pipe line or distribution system for the purchase and 
sale of natural gas, the direct ownership of which shall vest in, 
or which may under charter or franchise provisions ultimately 
vest in or be acquired by any municipality. 

Not to Discriminate. 

Sec. 3. That no common purchaser shall discriminate between 
like grades and pressures and natural gas, or in favor of its own 
production or of production in which it may be directly or in- 
directly interested, either in whole or in part, but for the pur- 
pose of pro-rating the natural gas to be marketed, such produc- 
tion shall be treated in like manner as that of any other producer 
or person, and shall be taken only in the ratable proportion such 
production bears to the total production available for marketing. 

Gas to Be Measured by Meter. 

See. 4. That all gas produced from the deposits of this State 
when sold shall be measured by meter and the Conservation 
Commission of Louisiana shall, upon notice and hearing, relieve 
any common purchaser from purchasing gas of an inferior grade 
or quality, and the Commission shall from time to time make 
such regulations for delivery, metering and equitable purchase 
and taking as conditions may necessitate. 



STATE STATUTES 669 



Department to See Provisions Are Complied with. 

Sec. 5. That it shall be the duty of the Conservation Commis- 
sion of Louisiana to see that the provisions of this Act are fully 
and properly complied with and it shall be further the duty of 
the District Attorney, in whose district any violation takes place, 
on application of the Conservation Commission of Louisiana, to 
bring; such suit or suits as may be necessary to enforce the pro- 
visions of this Act and any injunction which may be necessary 
shall be furnished without bond. 

Penalties. 

Sec. 6. That any person, firm or corporation or partnership 
violating any of the provisions of this Act shall be guilty of a 
misdemeanor and on conviction thereof in any court of compe- 
tent jurisdiction be liable and fined not less than $50.00, nor 
more than $500.00 or be subject to imprisonment for thirty days 
or be liable to both fine and imprisonment in the discretion of the 
Court for each offense, each day's continuation of such violation 
shall be and is hereby declared to be a separate offense. 

Sec. 7. That all laws, or parts of laws in conflict herewith be 
and the same are hereby repealed. 

NEBRASKA. 

Nebraska has no oil or gas Statutes but there is an Act in 
force in its present shape since 1903, offering a reward of $15,- 
000 for the opening of a 50 barrel well or well producing 500,- 
000 cubic feet of gas per diem. Act of 1903, p. 359. 

NEW MEXICO. 

Oil Plugging Act 

§ 3986. Well to Be cased Against Waters. ' 

Section 1. That the owner or operator of any well put down 
for the purpose of exploring for and producing oil or gas shall, 



670 MORRISON'S OIL RIGHTS 

before drilling into the oil or gas-bearing rock, incase the well 
with good and sufficient casing, and in such manner as to exclude 
all surface or fresh water from the lower part of such well, 
and from penetrating the oil or gas-bearing rock. Should any 
well be put down through the first into a lower oil or gas-bearing 
rock, the same shall be cased in such manner as will exclude all 
fresh or salt water from both upper and lower oil or gas-bearing 
rocks penetrated. Act of June 8, 1912, § 1. 

§ 3987. How Wells to Be Plugged. 

Sec. 2. The owner of any well, when about to abandon or 
cease operating the same, for the purpose of excluding all fresh 
or salt water from penetrating the oil or gas-bearing rocks, and 
before drawing the casing, shall fill the well with sand or rock 
sediment to the depth of ten feet above the top of each oil or 
gas-bearing rock, and drive therein a round tapered, seasoned 
wooden plug at least two feet in length, and in diameter equal 
to the full diameter of the well below the casing, and immediately 
upon drawing the casing shall fill in on top of such plug with 
sand or rock sediment to the depth of five feet, and again drive 
into the well a round wooden plug three 'feet in length, the lower 
end tapering to a point and to be of the same diameter at the 
distance of eighteen inches from the smaller end as the diameter 
of the well above the point at which the casing rested and the 
plug is driven; and after such plug has been driven, the well 
shall be filled with sand or rock sediment to the depth of not 
less than twenty feet. Id., § 2. 

§ 3988. On Default of Owner, Injured Party May Plug. 

Sec. 3. Whenever any person may be injured by the neglect 
or refusal to comply with the provisions of the preceding section, 
it shall be lawful for sucli person, after notice to the owner, 
lessee or care taker of the premises upon which such well is 
located, to enter upon and fill up and plug such well in the 
manner provided in this chapter, and thereupon to recover the 
expense thereof, from the person or persons whose duty it was 



STATE STATUTES 67 1 

to plug* or fill up such well in like maimer as debts of such 
amounts are recoverable, and shall have a lien upon the fixtures 
and machinery and leasehold interests of the owner or operator 
of such well. Id., § 3. 

§ 3989. Penalty for Neglect to Case or Plug. 

Se^.. 4. Any person, owner, driller, or operator violating the 
provisions of the first or second section of this chapter, shall be 
deemed guilty of a misdemeanor and upon conviction thereof 
shall be punished by a fine of not more than five hundred dollars, 
or by imprisonment for a period not exceeding six months, or by 
both such fine and imprisonment at the discretion of the court. 
Id,, § 4. 

NEW YORK. 

T lugging Abandoned Oil Wells. Flooding. 

Sec. 308. Whenever any well shall have been put down for 
the purpose of exploring for and producing oil or gas, upon 
abandoning or ceasing to operate the same, the owner or oper- 
ator shall, for the purpose of excluding water from the oil or 
gas-bearing rock, and before drawing the casing, fill up the 
well with sand or rock sediment to the depth of at least twenty 
feet above the third sand or oil-bearing rock, in case of an oil 
well, or any gas-bearing rock, in case of a gas well ; and in case 
of an oil well, drive a round, seasoned wooden plug, at least two 
feet in length, equal in diameter to the diameter of the well 
below the casing, to a point at least five feet below the bottom 
of the casing, and whether an oil or gas well, immediately 
after the drawing of the casing, shall drive a round, wooden 
plug into the well at the point just below where the lower end 
of the casing shall have rested, which plug shall be at least three 
feet in length, tapering in form, and to be of the same diameter 
at the distance of eighteen inches from the smaller end as the 
diameter of the well below the point at which it is to be driven ; 
and after it has been properly driven, shall fill in on top of same 
with sand or rock sediment to the depth of at least five feet. 



<)/2 MOKK ISOX'S OIL RIGHTS 

Provided, however, that this section shall not prevent the use of 
any such well for the operation known as "flooding," in lieu of 
plugging, if such flooding be done according to the recognised 
proper methods, and if the owner or operator of the well shall 
have filed with the clerk of the town in which the well is situated, 
when the taking of oil therefrom has ceased, a statement in writ- 
ing that the well, to be designated with common certainty, is 
reserved for purposes of flooding, and if such owner or operator 
shall have begun, in good faith, the flooding of such well within 
three months after the taking of oil therefrom has ceased. Act 
1919, p. 855 being substitute for § 308, Act of 1909, chap. 25. 

Misdemeanor to Fail to Plug. 

Sec. 309. Any person who shall violate the provisions of the 
last section shall, upon conviction thereof, be deemed guilty of a 
misdemeanor, and be punished by a fine of not less than two 
hundred nor exceeding five hundred dollars, or by imprisonment 
in the county jail of the county where the conviction shall be 
had, for a time not exceeding one year, or both such fine and 
imprisonment, in the discretion of the Court before whom such 
conviction shall be had ; one-half of the fine so imposed to be paid 
to the informer, the residue to the use of the school district in 
which such well may be situated. Cons. Laws, chap. 20, 1909. 

Neighbor May Plug Well at Owner's Expense. 

. Sec. 310. Whenever any owner or operator shall neglect or re- 
fuse to comply with the provisions of section three hundred and 
eight of .this Article, the owner of, or operator upon, any land 
adjoining that upon which such abandoned well may be, may 
enter, take possession of such abandoned well and plug the same, 
as provided by this Article, at the expense of the owner or 
operator whose duty it may be to plug the same. Id. 

Incorporation of Pipe Line Company. 

Sec. 40. Twelve or more persons may become a corporation 
for constructing and operating for public use, except in the city 
of New York, lines of pipe for conveying or transporting therein 



STATE STATUTES 673 

petroleum, gas, liquids or any products or property, or for main- 
taining and operating any line of pipe already constructed and 
owned by any corporation, person or persons, except in such 
city, for the public use, by making, signing, acknowledging and 
filing a certificate stating the name of the corporation, the num- 
ber of years it is to continue, the places from and to which it is 
to be constructed or maintained and operated, its length as near 
as may be, the name of each county through or into which it is 
to be constructed ; the amount of its capital stock, which shall 
not be less than fifteen hundred dollars for every mile of pipe 
constructed or proposed to be constructed, and the number of 
shares of which it shall consist; the number of directors not 
less than seven, and the names and places of residence of the 
directors for the first year, and the place of residence of each 
subscriber and the number of shares he agrees to take in such 
corporation, which must in the aggregate equal ten hundred and 
fifty dollars for every mile of pipe constructed or proposed to 
be constructed and twenty-five per centum of which must be 
paid in cash. 

Must Show Stock Subscribed. 

Such certificate shall have indorsed thereon or appended 
thereto and as a part thereof, an affidavit made by at least three 
of the directors named therein that at least ten hundred and 
fifty dollars of stock for every mile of line proposed to be con- 
structed or maintained and operated has been in good faith sub- 
scribed, and twenty-five per centum paid in money thereon, and 
that it is intended in good faith to construct or to maintain and 
operate the line of pipe mentioned in such certificate, and that 
such corporation was not projected or formed with the intent 
or for the purpose of injuring any person or corporation, nor for 
the purpose of selling or conveying its franchise to any person 
or corporation, nor for any fraudulent purpose. 1 

l The above and the next ten sections are printed in the Birdseye com- 
piled laws p. 8989 and were revised from Act of 1878, chap. 203; 1890, 
chap. 566; 1909, chap. 219. 
M. 0. R.— 43. 



G74 MORRISON'S OIL RIGHTS 

Location of Line. Map. 

Sec. 41. Every such corporation shall before commencing the 
construction of its pipe line in any county, or any proceeding 
for the condemnation of real property, plainly and distinctly 
mark and designate the line adopted and located by it by a line 
of stakes consecutively numbered and equally distant, and not 
more than twenty rods from each other, so that each line can 
be clefinitety known and ascertained in all places, and make a 
map and survey of the route so located and staked out, and 
shall indicate thereon plainly the* points where such route 
crosses each parcel of land to which it has not acquired title by 
agreement and shall cause such map and survey to be certified 
by the president and engineer, and filed in the office of the clerk 
of the county into or through which the line so located and 
mapped passes, and shall give to the owner or occupant, if he 
is known or can be ascertained, of every parcel of land through 
which such route passes, the title to which has not been acquired 
by purchase, written notice of the filing of such map and sur- 
vey, stating that such route passes over or across such owner's 
or occupant's lands, and that the route thereof is indicated 
thereon by such line of stakes. 

Hearing to Adjust Line. 

Any occupant or owner of such lands feeling aggrieved by 
the. proposed location may, within fifteen days after the service 
of such notice, give ten days' written notice to the corporation, 
by service upon the president, engineer, or any director thereof, 
and to the owner or occupant of any lands to be affected by the 
alteration to be proposed by him, of the time and place of an 
application to be made by him to a special term of the Supreme 
Court in the judicial district in which the lands are situated 
for the appointment of commissioners to relocate such line. If 
upon the hearing the Court shall consider that sufficient cause 
exists therefor, it shall appoint three disinterested persons com- 
missioners to examine the route located and the proposed altera- 
tion thereof, and direct the mode of proceeding, who shall report 
to the Court the facts relating thereto and their opinion as to 



STATE STATUTES (375 

the proposed alteration, and what, if any, alteration should be 
made in such line, and the Court shall thereupon make such 
order as it shall deem proper in relation to such alteration, and 
determine the location of such line, and fix and adjust the costs, 
fees and charges of the commissioners, and tin: costs and charges 
of the proceeding's, and direct by which party the same shall 
be paid, and may enforce payment thereof by proceedings as 
for a contempt of Court, for refusal to pay costs directed to be 
paid by an order of the Court, and such order shall be final 
as to the location of the line upon the lands embraced therein. 
Such corporation shall not commence the work of constructing 
or laying its line or pipe, or institute proceeding for the con- 
demnation of real property, in any county until after the expira- 
tion of fifteen days from the service by it of the notice herein 
required, nor until all applications for a relocation of its line in 
such county, if any are made, have been finally determined. 

Condemnation of Real Property. Restrictions. 

Sec. 42. In case such corporation is unable to agree for the 
purchase of any real estate required for the purpose of its cor- 
poration, and its line of pipe in the county in which such real 
estate is situated has been finally located, it shall have the right 
to acquire title thereto by condemnation, but such corporation 
shall not locate or construct any line of pipe through, or under 
any building, dooryard, lawn, garden or orchard, except by the 
consent of the owner thereof in writing duly acknowledged, or 
through any cemetery or burial ground, nor within one hundred 
feet of any building, except where such line is authorized by 
public officers to be laid across or upon any public highway, or 
whe ■ the same is laid across or upon any turnpike or plank- 
road. 

City Streets. 

Xo pipes shall be laid for the purpose of carrying petroleum, 
gas or other products or property through or under any of the 
streets in the cities of this State, unless such corporation shall 



676 MORRISON'S OIL RIGHTS 

first obtain the consent of a majority of the property owners 
on the streets which may be selected for the laying of pipe, and 
such pipe line shall be located with all reasonable care and pru- 
dence so as to avoid danger from the bursting of the pipes. 

Conflicting Rights at Railroad and Other Crossings. 

Sec. 43. Whenever any line of pipe of any such corporation 
shall necessarily cross any railroad, highway, turnpike or plank- 
road, such line of pipe shall be made to cross under such rail- 
road, highway, turnpike or plank-road and with the least injury 
thereto practicable, and unless the right to cross the same shall 
be acquired by agreement, compensation shall be ascertained and 
made to the owners thereof, or the public in case of highways, 
in the manner prescribed in the condemnation law, but no ex- 
clusive title or use shall be so acquired as against any railroad, 
turnpike or plank-road corporation, nor as against the rights of 
the people of this State in any public highway, but the rights 
acquired shall be a common use of the lands in such manner as 
to be of the least practical injury to such railroad, turnpike or 
plank-road, consistent with the use thereof by such pipe line 
corporation, nor shall any such corporation take or use any 
lands, fixtures or erections of any railroad corporation, or have 
the right to acquire by condemnation the title or use, or right 
to run along or upon the lands of any such corporation, except 
for the purpose of directly crossing the same when necessary. 

Bridges at Crossings. Precautions against Leaks. 

Sec. 44. No pipe line shall be constructed upon or across any 
of the canals of this State, except by the consent of and in the 
manner and upon the terms prescribed by the superintendent of 
public works, unless constructed upon a fixed bridge across such 
canal, and with the consent of the person for whose benefit such 
bridge is constructed and maintained or upon such a bridge over 
the canal, at the crossing of a public highway or street with the 
consent of the public officers having the supervision thereof, or 
of the municipal authorities of any village or city within whose 
limits such bridge may be, nor shall the pipes of any such cor- 



STATE STATUTES 677 

poration be laid through or along the banks of any of the canals 
of this State, nor through or under any of its rivers or creeks, 
unless such pipe shall be encased so as to prevent leakage, in 
such manner as shall be approved by the superintendent of pub- 
lic works. 

Consent of Municipal Authorities. 

Sec. 45. No pipe line shall be constructed across, along or upon 
any public highway without the consent of the commissioners of 
highways of the town in which such highway is located, upon 
such terms as may be agreed upon with such commissioners. 
If such consent or the consent of the commissioners or municipal 
authorities required by the preceding section cannot be obtained, 
application may be made to the appellate division of the Su- 
preme Court of the department in which such highway or bridge 
is situated for an order permitting the corporation to construct 
its line across, along or upon such highway, or across or upon 
such bridge. The application shall be by duly verified petition 
and notice which shall be served upon the commissioners of 
highways of the town in which the highway is situated, or the 
municipal authorities of the village or city where such bridge 
is located, according to the practice or order of the Court, or by 
an order to show cause, and the Court upon the hearing of the 
application may grant an order permitting the line to be so con- 
structed in such manner and upon such terms as it may direct. 

Consent to Enter Villages and Cities. 

Sec. 46. No pipe line shall be constructed into or through any 
incorporated village or city in this State unless authorized by 
a resolution prescribing the route, manner of construction and 
terms upon which granted, adopted at a regular meeting of the 
board of trustees of the village or the common council of the 
city by a two-thirds vote of such board or council, but such 
resolution shall not affect any private right. No pavement shall 
be removed in any city under the provisions of this article, un- 
less done under the direction of the common council, nor until 
such corporation shall give a bond in such sum as the common 



678 MORRISON'S OIL RIGHTS 

council may require for the replacing of any pavements which 
shall have been removed. In case any pavement shall have been 
removed and not properly relaid, the common council may bring 
suit in any court of record, for the cost of relaying' such pave- 
ment against any such corporation. No gas house shall be 
erected in any city under the provisions- of this article, for sup- 
plying gas to the inhabitants, unless consent is first given by 
the corporate authorities of the city. 

Across Indian Reservations. 

Sec. 47. Such corporation may contract with the chiefs of any 
nation of Indians over whose lands it may be necessary to con- 
struct its pipe line for the right to construct such pipe line upon 
such lands, but no such contract shall vest in the corporation 
the fee of such lands, nor the right to occupy the same for any 
purpose other than for the construction, operation and main- 
tenance of such pipe line, nor shall such contract be valid or 
effectual until the same has been ratified by the County Court 
of the county in which the lands are situated. 

Over State or Municipal Lands. 

Sec. 48. The commissioners of the land office shall have the 
power to grant to any pipe line corporation any lands belonging 
to the people of this State which may be required for the pur- 
pose of its incorporation on such terms as may be agreed on by 
them, or such corporation may acquire title thereto by condemna- 
tion, and if any lands owned by any county, city or town be re- 
quired by such corporation for such purposes, the county, city 
or town officer having charge of such lands may grant them to 
such corporations upon such terms and for such compensation as 
may be agreed upon. 

Additional Powers to Pipe Line Companies. 

Sec. 49. Every corporation formed under this article shall in 
addition to the powers conferred by the general and stock cor- 
poration laws have power: 



STATE STATUTES 679 

1. To cause such examinations and surveys of its proposed 
line of pipe to be made as may be necessary to the selection of 
the most advantageous route, and for such purpose by its officers, 
agents or servants may enter upon the lands or waters of any 
person, upon, through or across which such corporation can 
construct its line of pipe, under the provisions of this article, 
subject, however, to liability for all actual damage which shall 
be done thereto. 

2. To take and hold such voluntary grants of real estate and 
other property, as shall be made to it to aid in the construction, 
maintenance, operation and accommodation of its pipe line. 

3. To lay out its pipe line route not exceeding twelve feet in 
width, but at the terminations of such line and at all receiving 
and discharging points and at all places where machinery may 
properly or must necessarily be set up for the operation of such 
pipe line it may take such additional width, and for such length 
as may be necessary. 

4. To take and convey through pipes any property, substance 
or product capable of transportation therein by any force, power 
or mechanical agency, and to erect and maintain all necessary 
and convenient buildings, stations, fixtures and machinery for 
the purpose of its incorporation. 

5. To regulate the time and manner in which property shall 
be transported over its pipe lines, and the compensation to be 
paid therefor, but such compensation shall not exceed the sum 
or be above the rate of twenty-five cents per hundred miles for 
the transportation of forty-two gallons of any 'product trans- 
ported on lines of one hundred miles in length or over, which 
shall be reckoned and adjusted upon the quantity or number of 
gallons delivered by such corporation at the point to which it 
shall have undertaken to deliver the same. 

Storage. Rights of the Public. Common Carriers. Rates and 
Charges to Be Posted. 

Sec. 50. The pipe lines of every such corporation shall be 
open for transportation to the public use, and all persons desir- 
ing to transport products through such pipe line shall have the 



680 MORRISON'S OIL RIGHTS 

absolute right upon equal terms to such transportation in the 
order of application therefor, on complying with 'the general 
requirements of such corporation, as to delivery for and pay- 
ment of such transportation, but no application for such trans- 
portation shall be valid beyond or for a greater quantity of 
products than the applicant shall then own and have ready for 
delivery for transportation to such corporation and every such 
corporation shall provide suitable and necessary receptacles for 
receiving all such products for transportation, and for storage 
at the place of delivery until the same can reasonably be moved 
by the consignee, and shall be liable as common carriers therefor 
from the time the same is delivered for transportation until a 
reasonable time after the same has been transported to the place 
of consignment and ready for delivery to the consignee, which 
time shall be fixed by general regulation by the corporation, and 
shall not be less than two days from and after the same shall 
be ready for delivery and notice thereof given to such consignee, 
and all rates and charges of every description, for or on account 
of or in any manner connected with the transportation of any 
products, shall be fixed by such corporation by general rules 
and regulations, which shall be applicable to all parties who shall 
transport any products through such pipe line, or deliver or 
contract to deliver products for transportation and shall be writ- 
ten or printed and exposed to public view and at all times open 
to public examination. 

Routine as to Vouchers and Deliveries. 

Sec. 51. No receipt, certificate or order of any kind shall be 
made, accepted or issued by any pipe line corporation for any 
commodity unless the commodity represented by them is actually 
in possession of the corporation at the time of making, issuing 
or acceptance thereof. Whenever any such corporation shall 
have parted with the possession of any commodity and received 
therefor any order, voucher, receipt or certificate, such order, 
voucher, receipt or certificate shall not be issued or used again, 
but shall be canceled with the word "canceled" stamped or 
printed legibly across the face thereof, and such canceled order, 



STATE STATUTES 681 

voucher, receipt or certificate shall be filed and preserved by 
such corporation and a record of the same kept by the secretary 
thereof. No petroleum or other commodity received for trans- 
portation by such corporation shall be delivered to any person 
without the presentation and surrender of all vouchers, receipts, 
orders or certificates that have been issued' or accepted for the 
same. 

Monthly Statements to Be Filed. 

Sec. 52. Every pipe line corporation shall make monthly a 
specific statement showing the amount of all commodities re- 
ceived, the amount delivered during the month, and the stock 
on hand on the last day of each month of the year, and how 
much of such stock is represented by outstanding certificates, 
vouchers, receipts or orders, and how much in credit balances on 
the book of the corporation. Such statement shall be made on 
or before the tenth day of the succeeding month and verified by 
the oath of the president and secretary that it is in all respects 
true and correct, and shall be filed within three days thereafter 
in the county clerk's office in the county where the principal 
office of the corporation is located, and a true copy of the same 
posted in a conspicuous place in its principal office for at least 
thirty days thereafter. 

Fencing. Crossings. Gates. Damages. 

Sec. 53. It shall not be necessary for any such corporation to 
fence the lands acquired by it for the purpose of its incorpora- 
tion; but, if not enclosed by a substantial fence, the owner of 
the adjoining land from whom such lands were obtained, his 
heirs or assigns, may occupy and use such lands in any manner 
not injurious to the interests of the corporation and shall not be 
liable therefor, or for any trespass upon any such lands except 
for wilful or negligent injuries to the pipes, fixtures, machinery 
or personal property of the corporation. If the corporation 
shall keep such lands enclosed it shall construct and provide all 
suitable and necessary crossings with gates for the use and con- 
venience of any owners of lands adjoining the portion of its 



682 MORRISON'S OIL RIGHTS 

lands so enclosed, and no claim shall be made by it against any 
owner of adjoining lands to make or contribute to the making 
or maintaining of any division fence between such adjoining 
lands and its lands, and if it shall neglect to keep and maintain 
substantial fences along its lands the owners of adjoining lands 
may construct and maintain all farm or division fences, and all 
line fences crossed by such pipe line in the same manner as 
though it had not acquired such lands for such pipe line, and 
it shall be liable for all injuries to such fences caused or done 
by any of its officers or agents, or any persons acting in their 
or its behalf, or by any laborer in its or their employ or in the 
employ of any of its contractors. 

Taxed Same as Railroads. 

Sec. 54. The real estate and personal property belonging to 
any pipe line corporation in this State shall be assessed and 
taxed in the several towns, villages and cities in the same man- 
ner as the real estate and personal property of railroad corpora- 
tions are assessed and taxed, and such corporation may pay such 
taxes or commute therefor in the same manner as railroad cor- 
porations. 

By Act of 1889, chap. 422, natural gas companies organized 
to drill for it and distribute it were given the right of eminent 
domain with the usual condition requiring- municipal consent 
where the trenches encroach upon streets and the right of pre- 
liminary curvey. See 8 Birdseye's Cons. St., p. 8988. 

OHIO. 

Casing to Protect against Water. 

The owner or operator of a well for the production of petro- 
leum oil, natural gas or mineral water, before drilling intr 
the oil and gas-bearing rock, shall encase such well with good and 
sufficient wrought iron casing, so that the surface or fresh water 
from the lower part of such well will not penetrate the oil or 
gas-bearing rock. If a well is drilled through the first oil or 
gas-bearing rock into a lower one, it must be cased so as to 



STATE STATUTES 680 

exclude all fresh water above the last oil or gas-bearing rock 
penetrated. (90 v. 24, par. 1; 2 General Code 1910, § 6311.) 

Abandoned Well to Be Cemented. 

The owner or operator of a well constructed for any of the 
purposes named in the next preceding section, intending to 
abandon or cease operating it, and before drawing the casing 
therefrom, shall securely fill such well with rock sediment, or 
mortar composed of two parts sand and one part cement, to 
the depth of two hundred feet above the top of the first oil or 
gas-bearing rock, so as to prevent the surface or fresh water 
from penetrating to the oil or gas-bearing rock, and the gas and 
oil from escaping therefrom. (90 v. 24, par. 2; 2 General Code 
1910, § 6312.) 

Strangers May Act on Owners Failure to Comply. 

If such owner or operator fails to comply, or inefficiently 
complies with the next preceding section, the owner of the land 
upon which such well is situated shall forthwith comply there- 
with. If all the persons heretofore named fail to so fill, or in- 
efficiently so fill such well, any person, after written demand 
therefor to any of such persons, may enter, take possession of 
such well and fully comply with such section. (90 v. 24, par. 2; 
2 General Code 1910, § 6313.) 

Costs and Expenses to Be a Lien. 

The reasonable cost and expense of so filling such well shall 
forthwith be paid by such owner or operator, and on his de- 
fault, by the owner of the land. The amount of such cost and 
expense shall be a lien upon the fixtures, machinery and lease- 
hold interest of the owner and operator and upon the interest 
of the landowner in the land upon which the well is situated, 
and may be recovered and enforced against the owner or operator 
and the landowner in the order named. (90 v. 24, par. 2; 2 
General Code 1910, § 6314. 



684 MORRISON'S OIL RIGHTS 

Waste of Gas Prohibited. 

A person, copartnership or corporation, in possession as owner, 
lessee, agent or manager of a well producing natural gas, in 
order to prevent the gas wasting by escape, shall shut in and 
confine the gas therein, within ten days after penetrating the 
gas-bearing rock, until such time as it is utilized for light, fuel 
or power purposes. (90 v. 25, par. 3; 2 General Code 1910, 
§ 6315.) 

Flambeau Restrictions Not to Apply to Oil Well. 

The provisions of the next preceding section shall not apply 
to an oil well. (90 v. 25, par. 3; 2 General Code 1910, § 6316.) 

Flambeau Lights. Jumbo Burners. 

A person, copartnership or corporation shall not use natural 
gas for illuminating purposes on flambeau lights^ but "jumbo" 
burners or other burners consuming no more gas than such 
"jumbo" burners may be so used. A person, copartnership or 
corporation consuming natural gas with such burners in the 
open air or in or around derricks, shall turn it off not later than 
eight o'clock in the morning of each day such lights or burners 
are used, and shall not turn on or relight it between the hours 
of eight o'clock a. m. and five o'clock p. m. (92 v. 78, par. 4; 2 
General Code 1910, § 6317.) 

Proviso as to Flambeaux and Jumbos. 

The next preceding section shall not prohibit the burning 
ef flambeau lights within the derrick of a drilling well or for 
lighting the streets of cities and villages. (92 v. 78, par. 4; 2 
General Code 1910, § 6318.) 

Specific Penalty. 

A person, copartnership or corporation violating any pro 
vision of this chapter shall be liable to a penalty of one hundred 



STATE STATUTES 



685 



dollars, to be recovered, with costs of suit, in a civil action in the 
name of the State in the county in which the act was committed 
or omitted. Such suit may be brought at the instance of a resident 
of this State without security or liability for costs. Such penalty 
shall be paid one-half into the school fund of the county in which 
such suit is brought and one-half to such person at whose in- 
stance such suit was brought. (90 v. 25, par. 5 ; 2 General Code 
1910, § 6319.) 

Gas and Oil Leases to Be Recorded. 

All leases and licenses and assignments thereof, or of any in- 
terest therein, given or made, for, upon, or concerning lands 
or tenements in this State, whereby any right is given or 
granted to operate, or to sink or drill wells thereon for natural 
o-as and petroleum or either, or pertaining thereto, shall be filed 
for record, forthwith, and recorded in such lease record, with- 
out delay, and not be removed until recorded. (R. S. § 4112a; 
2 General Code 1910, § 5818.) 

Effect of Failure to Record. 

No such lease or license shall have any force or validity until 
it is filed for record as aforesaid, except as between the parties 
thereto, unless the person claiming thereunder is in actual and 
open possession. (R. S. § 4112a; 2 General Code 1910, § 8519.) 

Parties to Lease Cancellation Suits. 

The plaintiff in an action to cancel such lease or license, 
or in any way involving it, shall only be required to make the 
person or persons defendants, so far as such lease or license may 
be involved, who claim thereunder and are in possession as here- 
tofore stated, and those who then appear of record, or by the 
files in such office, to own or have an interest in such lease or 
license, fully and finally to adjudicate and determine all ques- 
tions made or involved therein concerning it. If there be no 
person in possession and claiming as heretofore specified, and no 
record. or writing or file as heretofore stated and required, then. 



686 MORRISON'S OIL RIGHTS 

so far as such lease or license is involved, it will only be neces- 
sary to make the original lessee or licensee defendant, fully and 
finally to adjudicate and determine all questions made or in- 
volved concerning such lease or license. (R. S. § 4112a; 2 
General Code 1910, § 8520.) 

GAS AND OIL WELLS. 

Verified Map of Coal, Gas and Oil Lands. 

Upon notice from the chief inspector of mines, or from a dis- 
trict inspector, each person, firm or corporation, engaged in 
drilling or exploring for natural gas or oil upon land from which 
eoal is being mined, shall make an accurate map thereof, show- 
ing the boundaries of each tract of land drilled upon, the build- 
ings and all monuments found upon the premises. Each well 
shall be plainly marked by a name, number or letter, and located 
whenever possible with reference to some well-defined and last- 
ing monument. Such map shall contain a sworn statement of 
the person, firm or corporation operating such oil or gas wells 
that it is a true representation of the property. Within sixty 
days after such notice, a copy of such map shall be filed in the 
office of the chief inspector. (R. S. § 306-1; 1 General Code 
1910, § 943.) 

Map of Coal Mine on Oil Land. 

Before mining for coal, each person, firm or corporation leas- 
ing land for such purposes, upon which gas or oil wells have 
been drilled to, or below any seams or veins of such coal, shall 
make, or cause to be made, and file in the office of the chief in- 
spector of mines such a map as is desired in the preceding sec- 
tion. (R. S. § 306-2; 1 General Code 1910, § 944.) 

Sealing of Wells Penetrating Coal. 

If a person, firm or corporation sinks a well for gas or oil 
through a mine in which coal or other mineral is being mined,' 
the person drilling such well shall drill it to a depth of not less 
than ten feet below the vein of coal or other mineral, case such 



STATE STATUTES 687 

hole and seal it upon the outside of the casing with suitable 
material to the level of the coal floor. Each vein of mineral 
coal being mined, pierced by such well, shall be sealed in the 
manner. (R. S. § 306-3; 1 General Code 1910, § 945.) 

Idem, When Well Abandoned. 

Before abandoning or ceasing to operate a well drilled for 
oil or gas, which passes through a vein of mineral coal, and be- 
fore drawing the casing therefrom, the owner of such well shall 
seal it by driving in such well to a depth of not less than ten 
feet below the floor of the lowest coal measure, a round, seas- 
oned, wooden plug at least three feet in length, and equal in 
diameter to the diameter of the well at that point. On the top 
of such plug he shall fill at least seven feet of sediment or dril- 
lings, or cement and sand. Upon abandoning or ceasing to 
operate a gas or oil well which passes through any gas or oil- 
bearing rock lying above the coal measures, the owner of such 
well or his agent shall drive to a point as near as possible to 
the top of the coal vein a dry wooden plug not less than two 
feet in length, and equal in diameter to the diameter of the hole. 
On the top of such plug, he shall fill at least five feet of sediment 
or drillings, or cement and sand, as a mine inspector shall direct. 
(R. 6. § 306-4; 2 General Code 1910, § 946.) 

Penalty for Non-Compliance. 

Each person, firm or corporation, failing to comply with any 
of the provisions of the preceding four sections, shall be sub- 
jet to a forfeiture of not less than one hundred nor more than 
two hundred dollars, to be recovered by action in the name of 
the State, and on collection paid into the court of common pleas 
of the county wherein any such well is located or of Franklin 
county. (R. S. § 306-5; 2 General Code 1910, § 947.) 

Additional Penalty. 

Whoever violates any provisions of such four sections shall 



688 MORRISON'S OIL RIGHTS 

be fined not less than fifty dollars, nor more than two hundred 
dollars, or be imprisoned not less than ten days nor more than 
thirty days, or both. (R. S. § 306-5; 2 General Code 1910, 

§ 948.) 

Act Amending Sections 973, 914, and 976 

Section 1. That sections 973, 914, and 976 of the General Code 
be amended to read as follows: 

Map of Oil and Gas Wells in Coal Townships. 

Sec. 973. Any person, firm, or corporation holding property 
in any coal bearing or coal producing township, in any county 
of the state of Ohio, either in fee, by virtue of a lease for oil 
or gas, mining purposes since January first, 1900, or otherwise, 
whereon wells have been drilled for oil, gas or test purposes, 
shall cause to be made by a competent engineer, an accurate 
map on a scale of not less than one inch to four hundred feet, 
showing on said map the location and number of wells as near 
as same can be located, that have been drilled, whether or not 
any of such wells have been previously abandoned, or were 
drilled and abandoned by former operators, who have ever held 
the said property for oil, gas or mining purposes. 

Details of Such Map. 

Said map shall show the name and address of the person, firm 
or corporation owning said well or wells, the county and town- 
ship, the names of the adjoining property owners, and lines of 
the property operated with the distances of the wells properly 
measured therefrom and checked from the section and quarter 
section lines, as will be necessary for an accurate survey. The 
map shall show all the engineer's notations of angles, distances, 
starting points, or corner stones, together with the numbers 
given the respective wells, giving a legend as to the manner, in 
which various abandoned or producing wells, are designated. 
The original map shall be retained by the owner or his agent, 
and one copy filed with the industrial commission of Ohio, divi- 



STATE STATUTES 689 

sion of mines, said copy showing thereon the sworn statement 
of the engineer making the map, that same is correct. 

Limitation with Respect to Mine Opening. 300 Feet Protec- 
tion to Coal Mine Adits. 

No oil well, gas well or test well shall be drilled nearer than 
three hundred feet to any opening to a mine used as a means of 
ingress or egress for persons employed therein, nor nearer than 
one hundred feet to any building or inflammable structure con- 
nected therewith, and actually used as a part of the operating 
equipment of said mine. 

Permit to Drill Required in Coal Townships. 

Any person, firm or corporation before drilling or causing to 
be drilled any oil -well, gas well or test well within the limits of 
any coal producing township in any county of the State of Ohio, 
shall first file an application with the industrial commission of 
Ohio, division of mines, on blanks to be furnished by said com- 
mission for such purpose, and shall show the following : The 
name and address of the applicant, the proper date, location of 
the proposed well — giving the name of the property owner, sec- 
tion number, township and county, the number of the proposed 
well, and signed by an officer or agent of such operator. No 
well shall be commenced until the applicant or operator has been 
granted a permit, which shall be granted by the industrial com- 
mission of Ohio, division of mines, under the following condi- 
tions : 

Map Demanded before Permit. 

If such proposed well is located within the limits directly 
adjacent to mining operations, such limits to be determined by 
the industrial Commission of Ohio, division of mines, the appli- 
cation for permit must be accompanied by a map showing the 
location of the proposed well and answering the requirements in 
the preceding regulations for mapping. 

If such proposed well is not located within the limits directly 
adjacent to mining operations, but within the limits of any coal 
M. 0. R.— 44. 



690 MORRISON'S OIL RIGHTS 

producing or coal-bearing township, the industrial commission 
of Ohio, division of mines, shall grant a permit immediately up- 
on receipt of the application, providing the applicant is a re- 
sponsible person, firm or corporation. The industrial commis- 
sion of Ohio, division of mines, may at any time after the well 
is commenced, if the responsibility of the applicant or operator 
is considered doubtful, cause such operator or applicant to show 
proper guaranty of his intention to fulfill the requirements of 
this section, or cause all operations to cease forthwith. If any 
person, firm or corporation continues drilling on property al- 
ready surveyed in accordance with the preceding requirements, 
a complete blue print or copy of map shall be made at the end 
of each year ending June 30, showing the additional wells prop- 
erly surveyed by a competent engineer as above mentioned, and 
filed with the industrial commission of Ohio, division of mines, 
not later than the following first of September. 

Abandonment Regulated. 

When any oil well, gas well or test well is to be abandoned, 
the person, firm or corporation owning such well shall notify 
the industrial commission of Ohio, division of mines, or the 
deputy oil and gas well inspector of the district in which the 
well is located, as many days in advance as will be necessary 
for the inspector to arrange to be present at such abandonment. 
No well shall be abandoned without an inspector being present, 
unless permission has been first granted upon good cause shown, 
by the industrial commission of Ohio, division of mines. 

Abandoned Wells to Be Plugged and Cemented. 

When any oil well, gas well or test well is to be abandoned, 
it must first be plugged in some secure manner above the oil or 
gas sand or rock formation, either by placing or driving one 
or more good seasoned wooden plugs, or a lead plug, as the case 
may require, so that no gas or oil may escape, or any water or 
destructive matter force itself into the oil or gas sand, or rock 
formation. Upon such seasoned wooden plug or plugging ma- 
terial shall be filled at least thirty feet of cement properly mixed 



STATE STATUTES 691 

with sand, or thirty feet of good clay or rock sediment properly 
prepared. 

If any well has passed through a workable vein or seam of 
coal, it shall when it is abandoned be plugged in the following 
manner: A seasoned wooden plug shall be driven to a point 
thirty feet below the lowest workable seam of coal and the hole 
filled with cement to a point at least twenty feet above this seam 
of coal, at which point another wooden plug shall be placed 
and the hole filled for a distance of twenty feet with cement or 
properly prepared clay, or rock sediment. If there is more than 
one seam of coal the next seam above must be plugged off in like 
manner. 

Details of Casing When Well Penetrates Mine. 

In the event" that a well being drilled penetrates the excava- 
tions of any mine, it must be cased with casing of approxi- 
mately the same diameter as the diameter of the hole, the hole 
to be drilled thirty feet or to solid slate or rock and not less than 
ten feet below the floor of such mine, and the casing shall be 
placed in the following manner: One string of casing shall be 
placed at a point above the roof of said mine so as to shut off 
all of the surface water ; then the hole drilled through said mine 
and another string of casing put in. The bottom of the second 
string of casing, or the one passing through said mine, shall 
not be nearer than ten feet, or more than thirty feet from the 
floor of the mine where it passes through the same. 

When any well which has been drilled is to be abandoned and 
has passed through the excavations of any coal mine from which 
the minable coal has not all been removed, the person, firm or 
corporation owning said well shall leave in said well the casing 
passing through said mine from a point not less than ten feet, 
nor more fhan thirty feet below the floor of said mine, and ex- 
tending above the roof of said mine at least five feet. A sea- 
soned wooden plug shall be driven to a point at least forty feet 
below the floor of the mine and the hole above said plug together 
with the casing left in, which extends through the coal, shall be 
filled with cement ; then a seasoned wooden plug shall be driven 



692 MORRISON'S OIL RIGHTS 

on the top of said casing, and the hole filled with cement for a 
distance of not less than twenty feet. 

"Coal Bearing or Coal Producing Township" Denned. 

A coal bearing or coal producing township of any county shall 
be interpreted to mean any township as a unit, in which coal is 
found that is being mined, or is of such thickness as to make it 
likely to be mined at some future time. Any well drilled in such 
township, whether or not it passes through any coal, the same 
being barren in certain sections of such township, or the well 
being commenced below the line of outcrop of the coal, will 
nevertheless be required to be mapped and abandoned in ac- 
cordance with the regulations and provisions of this section as 
given above, which shall apply uniformly throughout any coal 
bearing or coal producing township of any county. Sec. 1, Act 
1917 p. 630. 

Designation and Supervision of Coal Townships. 

Sec. 914. The chief deputy inspector of mines and the oil 
and gas well inspector shall designate the townships in the vari- 
ous coal producing counties of Ohio, which shall be considered 
coal bearing or coal producing townships, to be included under 
the regulations as prescribed in section 973 relating to the map- 
ping, drilling and abandonment of oil, gas or test wells. The 
chief deputy inspector of mines shall allow all matter pertaining 
to the mapping and drilling of oil and gas wells to be under the 
direct supervision of the oil and gas well inspector, except when 
wells are to be drilled, or have been drilled directly adjacent to 
some mining operation, or in case any arrangement for the dril- 
ling of an oil or gas well must necessarily be made in mutual 
understanding and consideration with some mining operation, 
or whenever the proper protection of the coal deposits is in ques- 
tion. 

Supervision of Permits, Maps and Plugging. 

The oil and gas well inspector shall supervise the granting of 
permits to drill or abandon a well, the filing and reprinting of 



STATE STATUTES 693 

maps of oil, gas or test wells, and see that all the provisions 
relating to the mapping, drilling, and abandonment of such wells 
are strictly complied with. In any case where the plugging 
method as outlined in section 973 cannot be applied, or if ap- 
plied, would be found ineffective in carrying out the intended 
protection, which the law is meant to give, the oil and gas well 
inspector may designate the method of plugging to be used, in 
all such cases causing the abandonment report to show the man- 
ner in which the work was done. 

Designation of Counties. Regulations. 

The oil and gas well inspector shall designate the counties or 
townships thereof which shall compose the different districts of 
the respective deputy oil and gas well inspectors, or change such 
districts whenever in his judgment the best interests of the serv- 
ice so demands. He shall issue instructions and regulations for 
the government of the deputy inspectors as will be consistent 
with the powers and duties vested in them by law, and secure 
the proper protection which the law intended. The oil and gas 
well inspector shall give such personal assistance to the deputy 
inspectors as they may need and make such personal inspection 
as he deems necessary throughout all the districts, at any time. 

Enforcement of Regulations. Right of Appeal. 

Each deputy oil and gas well inspector shall carry out the 
instructions of the oil and gas well inspector with reference to 
the enforcement of the regulations provided in section 973, or 
other regulations that are deemed necessary to insure the pro- 
tection which this section intends. Any person, firm or corpora- 
tion dissatisfied with the ruling of the chief deputy inspector 
of mines, or the oil and gas well inspector under the provisions 
of this section shall have the right of appeal to the industrial 
commission of Ohio within ten days from the date of such ruling. 
Sec. 2, Act. 1917, p. 630. 

Penalty against Coroner. 

Sec. 976. Any county coroner who, after receiving notice of 



694 MORRISON'S OIL RIGHTS 

a fatal accident, or of an accident which has resulted in the death 
of a person, at, in, or around a mine, from the owner, lessee or 
agent of such mine, or the chief inspector of mines, wilfully 
lefuses or neglects to comply, so far as such provisions relate to 
him, with the provisions of section nine hundred and twenty-one 
of the General Code, shall, upon conviction thereof, be fined not 
less than twenty-five dollars nor more than fifty dollars, at the 
discretion of the court. 

Penalties against Owners and Lessees. 

Any owner, lessee or agent of a mine, or any person, firm or 
corporation opening a new mine, having written knowledge of a 
violation of this act, who wilfully refuses or neglects to comply 
with the provisions of sections nine hundred and twenty-two, 
nine hundred and twenty-three, nine hundred and twenty-four, 
nine hundred and twenty-five, nine hundred and twenty-six, 
nine hundred and twenty-seven, nine hundred and twenty-eight, 
nine hundred and twenty-nine, nine hundred and thirty, nine 
hundred and thirty-one, nine hundred and thirty-two, nine hun- 
dred and thirty-three, nine hundred and thirty-four, nine hun- 
and thirty-seven, nine hundred and thirty-eight, nine hundred 
and thirty-nine, nine hundred and forty, nine hundred and 
forty-one, nine hundred and forty-two, nine hundred and forty- 
three, nine hundred and forty-four, nine hundred and forty-five, 
nine hundred and forty-six, nine hundred and forty-seven, nine 
hundred and forty-eight, nine hundred and forty-nine, nine hun- 
dred and fifty, or nine hundred and seventy-one of the General 
Code, shall, upon conviction thereof, be fined not less than twen- 
ty-five dollars nor more than fifty dollars, and for a second or 
any subsequent offense shall be fined not less than fifty dollars 
nor more than one hundred dollars, at the discretion of the 
Court. 

Penalties against Superintendent or Foreman. 

Any superintendent, mine foreman, foremen or overseer, who 
wilfully refuses or neglects to comply, so far as such provisions 
relate to each of them with the provisions of sections" nine hun- 



STATE STATUTES 695 

dred and fifty-one, nine hundred and fifty-two, nine hundred and 
fifty-three, and nine hundred and fifty-four of the General Code, 
shall, upon conviction thereof, be fined not less than ten dollars 
nor more than twenty-five dollars, and for a second or subse- 
quent offense shall be fined not less than ten dollars nor more 
than twenty-five dollars, or imprisoned not less than ten days nor 
more than twenty days, or both, at the discretion of the Court. 

Penalties in Fire-damp Cases. 

Any person or persons who wilfully refuses or neglects to 
comply with the provisions of section nine hundred and fifty- 
five of the General Code, or enters a mine generating fire-damp 
before it is reported by the fire boss that it is safe for persons 
to enter, or goes beyond a danger signal indicating an accumu- 
lation of fire-damp, as forbidden by the provisions of section 
nine hundred and fifty-nine of the General Code, shall, upon 
conviction thereof, be fined not less than twenty-five dollars nor 
more than fifty dollars, and for a second or any subsequent of- 
fense shall be fined not less than twenty-five dollars nor more than 
fifty dollars, or imprisoned not less than ten days nor more than 
twenty days, or both, at the discretion of the Court. 

Any person or persons who violates the provisions of sections 
nine hundred and fifty-six, nine hundred and fifty-seven, nine 
hundred and fifty-eight, nine hundred and sixty, nine hundred 
and sixty-one, nine hundred and sixty-two of the General Code, 
or violates the provisions of section nine hundred and fifty-nine 
of the General Code other than to enter a mine generating fire- 
damp, before the fire boss reports it safe, or to go beyond a 
danger signal indicating an accumulation of fire-damp, shall, 
upon conviction thereof, be fined not less than five dollars, nor 
more than ten dollars, and for a second or any subsequent of- 
fense shall be fined not less than five dollars nor more than ten 
dollars, or imprisoned not less than five days nor more than ten 
days, or both, at the discretion of the court. 

Loitering and Liquor. 

Any person who wilfully violates the provisions of sections 



696 MORRISON'S OIL RIGHTS 

nine hundred and sixty-four, nine hundred and sixty-five, nine- 
hundred and sixty-six, nine hundred and sixty-seven or nine 
hundred and seventy of the General Code or violates the pro- 
visions of section one hundred and fifty-nine of the General Code 
relating to loitering and intoxicants, at, in or around a mine, 
shall, upon conviction thereof, be fined not less than five dol- 
lars nor more than ten dollars, or imprisoned not less than five 
days nor more than ten days, or both, at the discretion of the 
Court. 

Further Penalties. Well Not Properly Plugged. 

Any person, firm or corporation who violates or wilfully re- 
fuses or neglects to comply with the provisions of section 973, 
shall, upon conviction thereof, be fined not less than one hun- 
dred dollars, nor more than five hundred dollars, and for a sec- 
ond or any subsequent offense shall be fined not less than two 
hundred dollars and not more than one thousand dollars, or im- 
prisoned not less than thirty days nor more than six months, at 
the discretion of the Court. In addition, if the material is pulled 
out of a well which was not plugged in accordance with the 
provisions of section 973, the person, firm or corporation causing 
such offense may be made to clean out such well and _properly 
plug the same, or pay the entire reasonable cost of such work 
being done under orders of the industrial commission of Ohio, 
division of mines, within thirty days. 

Sale of Prohibited Lighting Material. 

Any person, firm or corporation who compounds, sells or of- 
fers for sale to dealers any oil or paraffine wax, fish oil or any 
other illuminant whatever, other than those specifically provided 
for in section 974, General Code, unless with the consent and ap- 
proval of the chief inspector of mines, for illuminating purposes 
in any mine in this State contrary to the provisions, of sections 
nine hundred and seventy-four and nine hundred and seventy- 
five of the General Code, shall, upon conviction thereof, be fined 
not less than fifty dollars nor more than one hundred dollars, 
and for a second or any subsequent offense shall be fhfted not less 



STATE STATUTES 697 

than one hundred dollars nor more than two hundred dollars, 
or imprisoned not less than thirty days nor more than sixty days, 
or both, at the discretion of the Court. 

Approval of Chief Inspector. Luminants. 

Any person, firm or corporation who sells, or offers for sale 
to any employee of a mine for illuminating purposes in a mine 
any oil or paraffine wax, fish oil or any other illuminant, other 
than those specifically provided in section nine hundred and 
seventy-four of the General Code, unless with the consent and 
approval of the chief inspector of mines, contrary to the pro- 
visions of section nine hundred and seventy-four and nine hun- 
dred and seventy-five of the General Code, shall, upon conviction 
thereof, be fined not less than twenty-five dollars nor more than 
fifty dollars and for a second or any subsequent offense shall be 
fined not less than twenty-five dollars nor more than fifty dollars, 
or imprisoned not less than ten days nor more than twenty 
days, or both, at the discretion of the Court. 

Use of Prohibited Lighting Material. 

Any person who knowingly uses for illuminating purposes in 
a mine, any oil or paraffine wax, fish oil or any other illuminant 
whatever other than those specifically provided for in section 
nine hundred and seventy-four of the General Code, unless with 
the consent and approval of the chief inspector of mines, con- 
trary to the provisions of sections nine hundred and seventy- 
four and nine hundred and seventy-five of the General Code, 
shall, upon conviction thereof, be fined not less than five dollars 
nor more than ten dollars, and for a second or any subsequent 
offense shall be fined not less than five dollars nor more than ten 
dollars, or imprisoned not less than five days nor more than ten 
days, or both, at the discretion of the Court. Sec. 1, Act 1917, 
p. 630. 

This Act consists of a single section amending 3 separate sec- 
tions of the General Code of 1910. 



698 MORRISON'S OIL RIGHTS 

OKLAHOMA. 
Chapter 53. 

OIL AND GAS. 
ARTICLE I. 

GAS PIPE LINES. 

4290. Gas Corporations. 

Any firm, copartnership association, or combination of indi- 
viduals may become a body corporate under the laws of this 
State, for the purpose of producing, transmitting', or transport- 
ing natural gas to points within this state by complying with the 
general corporation laws of the State of Oklahoma, and with 
this article. 

4291. Gas to Be Kept within State. 

No corporation organized for the purpose of, or engaged in 
the transportation or transmission of natural gas within this 
State shall be granted a charter or right of eminent domain, or 
right to use the highways of this State, unless it shall be express- 
ly stipulated in such charter that it shall only transport or trans- 
mit natural gas through its pipe lines to points within this State ; 
that it shall not connect with, transport to, or deliver natural gas 
to individuals, associations, co-partnerships, companies or cor- 
porations engaged in transporting or furnishing natural gas to 
points, places or persons outside of this State. 

4292. Foreign Gas Pipe Lines Shall Not Be Licensed. 

Foreign corporations formed for the purpose of, or engaged 
in the business of transporting or transmitting natural gas by 
means of pipe lines, shall never be licensed or permitted to con- 
duct such business within this State. 



STATE STATUTES 699 

4293. Pipe Line Companies Must Comply with This Article. 

No association, combination, copartnership or corporation 
shall have or exercise the right of eminent domain within this 
State for the purpose of constructing or maintaining a gas pipe 
line within this State, or shall be permitted to take private or 
public property for their use within this State, unless expressly 
granted such power in accordance with this article. 

4294. Right of Way Must Be Granted and Damages Paid. 

The laying, constructing, building and maintaining a gas pipe 
line for the transportation or transmission of natural gas along 
over, under, across or through the highways, roads, bridges, 
streets, or alleys in this State, or of any county, city, municipal 
corporation or any other private or public premises within 
this State is hereby declared an additional burden upon said 
highway, bridge, road, street or alley, and any other private, or 
public premises, and may only be done when the right is granted 
by express charter from the State; and such gas pipe line shall 
not be constructed, maintained, or operated until all damages to 
adjacent owners are ascertained and paid as provided by law. 

4295. Inspection. 

All pipe lines for the transportation or transmission of natural 
gas in this State shall be laid under the direction and inspection 
of proper persons, skilled in such business, to be designated by 
the chief mine inspector for such duty, and the expenses of such 
inspection and supervision shall be borne and paid for by the 
parties laying and constructing such pipe lines for the trans- 
portation or transmission of natural gas. 

4296. Pressure Pumps Prohibited. 

No pipe line for the transportation or transmission of natural 
gas shall be subjected to a greater pressure than three hundred 
pounds to the square inch, except for the purpose of testing such 
lines, and gas pumps shall not be used on any gas pipe line for 



700 MORRISON'S OIL RIGHTS 

the transportation or transmission of natural gas or used on or 
in any gas well within this State. 

4297. Transporting Out of State — Proceedings and Penalty. 

Any corporation granted the right under the provisions of 
this article to exercise the right of eminent domain, or use the 
highways of this State to construct or maintain a gas pipe line 
for the transportation or transmission of natural gas to points 
within this State, which shall transport or transmit any natural 
gas to a point outside of. or beyond this State, or shall connect 
with or attempt to connect with or threaten to connect with any 
gas pipe line furnishing, transporting, or transmitting gas to 
a point outside of, or beyond this State, shall by each or all of 
said acts, forfeit all right granted it or them by charter from 
this State, and said forfeiture shall extend back to the time of 
the commission of said act or said acts in violation of this article ; 
and said Acts shall of themselves work a forfeiture of any and 
all rights of any and every kind and character which may be or 
may have been granted by the State for the transportation or 
transmission of natural gas within this State, and all the prop- 
erty of said corporation and all the property at any time be- 
longing to said corporation, at any time used in the construc- 
tion, maintaining or operation of said gas pipe line or lines shall, 
in due course of law, be forfeited to and be taken into the pos- 
session of the State through its proper officer and in said action 
there shall be a right in the State to the appointment of a re- 
ceiver, either before or after the judgment, to be exercised at 
the option of the State, and the officer taking possession of said 
property shall immediately disconnect said pipe line or lines at 
a proper point in this State from any pipe line or lines going out 
of, or beyond the State. 

Note. — This section has been declared unconstitutional and 
also repealed by legislation. Stewart v. Tennant, 52 W. Va. 559; 
44 S. W. 223. McNeeley v. South Penn Oil Co. 52 W. Ya. <5M, 
44 S. E. 508. 

There have been repeated efforts by more than one State to 
prohibit directly or indirectly the transportation of natural gas 



STATE STATUTES 701 

beyond the limits of the State where produced. Such statutes 
have of course been declared void because of their interference 
with the Interstate power of Congress. Kansas Natural Gas Co. 
v. Haskell, 172 Fed. 545. Aff'd 221 U. S. 229, 55 L. ed. 221, 
31 Sup. Ct. Rep. 564. 

But this Oklahoma Act goes far beyond what had been at- 
tempted before. It not only revokes the charter of any corpora- 
tion attempting to export the gas but attempts by drastic pro- 
cedure to forfeit for such violation the property of the offending 
corporation. 

A smiliar act of West Virginia was protested by the Legisla- 
ture of Pennsylvania. See page 785. 

4298. Same — Sale of Property — Revocation of Charter. 

Said property shall be sold as directed by the Court having ju- 
risdiction of said proceedings, and the proceeds of said sale 
shall be applied, first to the payment of the cost of such pro- 
ceeding, and the remainder, if any, paid into the school fund of 
the State, and said charter under which said act or acts were 
committed shall be revoked, and no charter for the transporta- 
tion or transmission of natural gas shall never (ever) be granted 
to any corporation having among its stockholders any person 
who was one of the stockholders of said corporation whose char- 
ter has or may have been forfeited as aforesaid; and if such 
charter shall have been granted, and thereafter a person shall 
become a stockholder thereof who was one of the stockholders of 
the corporation whose charter has been or may have been forfeit- 
ed, as herein provided, the charter of said corporation, one of 
whose stockholders is as last named shall therefore be forfeited 
and revoked: Provided, that any person who may be denied the 
right to become a stockholder as above prescribed may be grant- 
ed the right to become such stockholder by the corporation com- 
mission when such person shows to the commission that he was 
not a party to the former violations of this article. 

4299. Lines over Private Property. 

No pipe lines for the transportation or transmission of natural 



702 MORRISON'S OTL RIGHTS 

gas shall be laid upon private or public properly when the pur- 
pose of such line is to transport or transmit gas' for sale to the 
public until the same is properly inspected as provided in this 
article; and before any gas pipe line company shall furnish or 
sell to the public, it shall secure from the inspector a certificate 
showing that said line is laid and constructed in accordance witli 
this article, and under the inspection of the proper officer : Pro- 
vided, that nothing in this article shall be construed to prevent 
persons drilling for oil and gas from laying surface lines to 
transport or transmit gas to wells which are being drilled with- 
in this State ; and Provided, further, that factories in this State 
may transport or transmit gas through pipe lines for their own 
use for factories located wholly within this State, upon securing 
the right of way from the State over or along the highway and 
from property owners to their lands. 

4300. Corporations Become Domestic. 

No person, firm, association, or corporation shall ever be per- 
mitted to transmit or transport natural gas by pipe lines in 
this State or in this State construct or operate a pipe line for 
the transmission of natural gas, except such persons, firms, as- 
sociations or corporations be incorporated as in this article pro- 
vided, except as provided in the preceding section; 

4301. Information to Be Furnished Commission. 

Before any gas pipe line corporation shall acquire any right 
of way, or exercise the right of eminent domain within this 
State, or construct any pipe lines for the transportation of gas, 
it shall file in the office of the corporation commission a plat 
showing in detail the points in this State, between which and the 
route along which its trunk line is proposed to be constructed, 
the intended size and capacity thereof, and the location anc^ 
capacity of all pumping stations, gate valves, check valves and 
connections of all kinds on said trunk lines; and upon the de- 
mand of the corporation commission it shall file a plat showing 
in detail all the lines owned or operated by it, with full infor- 
mation as to their -capacity and size, location and capacity of 



STATE STATUTES 703 

its pumping station, gate valves, check valves and connections 
of all kinds in existence. 

4302. Domestic Pipe Line Companies May Erect Pumping 
Stations. 

All domestic gas pipe line corporations in this State are here- 
by authorized to build and operate, and for that purpose to ac- 
quire, whether by purchase or the exercise of eminent domain, 
sites for the erection of pumping stations in this State wherever 
the same may be necessary, due consideration being had for the 
size, capacity, pressure, facilities and powers of all other gas 
pipe line corporations and gas consumers and gas producers, in 
the same gas district which may be affected by the use of said 
pumps. 

4303. Domestic Pipe Line Companies May Cross Highways. 

Every domestic gas pipe line corporation in this State is here- 
by given authority to build, construct and maintain gas pipe 
lines, over, under, across or through all highways, bridges, streets 
or alleys in this State, or any public place therein, under the 
supervision of the inspector of oil and gas as to where and how 
in said highways, bridges, streets, alleys and public places said 
pipe line shall be laid, subject to the control of the local munic- 
ipalities as to how the business of distribution in that municipal- 
ity shall be conducted, and subject to responsibility as otherwise 
provided by law : Provided, however that whenever any gas pipe 
line crosses the land or premises of any one outside of a munic- 
ipality, said corporation shall, upon request of the owner of said 
premises, connect said premises with a pipe line and furnish 
gas to said consumer at the same rate as charged in the nearest 
city or town. 

ARTICLE II. 

OIL PIPE LINES. 

4304. Oil Companies Must Comply with This Article— Pen- 
alty. 

Every corporation, joint stock company, partnership or other 



704 MORRISON'S OIL RIGHTS 

person, exercising or claiming the right to carry or transport 
crude oil or petroleum, or any of the products thereof, by or 
through pipe lines, for hire or otherwise, or exercising or claim- 
ing the right to engage in the business of producing crude oil 
or petroleum, or of refining it, or manufacturing any of the pro- 
ducts thereof, or of storing crude oil or petroleum produced by 
it, or any other person, or engaging in the business of buying, 
selling or dealing in crude oil or petroleum, within the limits of 
this State, shall not have or possess the right to conduct or en- 
gage in said business or operation, in whole or in part, as above 
described, or have or possess the right to locate, maintain or 
operate the necessary pipe lines, fixtures and equipment there- 
unto belonging, or used in connection therewith, concerning the 
said business of carrying or transporting crude oil or petroleum 
as aforesaid, on, over, along, across, through, in or under any 
present or future highway, or part thereof, within this State, or 
have or possess the right of eminent domain or any other rights, 
concerning said business or operations, in whole or in part, ex- 
cept as authorized by and subject to the provisions of this arti- 
cle, and except such rights as may already exist which are valid, 
vested, and incapable of revocation by any law of this State or 
the laws of the United States. The word "petroleum" as used 
herein means all crude oil and its manufactured products, not 
including natural gas. 

4305. Right of Way. 

For the purpose of acquiring necessary right of way, every 
such person is hereby granted the right of condemnation by 
eminent domain, and the use of the highways in this State, for 
the purpose of transporting petroleum by pipe lines, and the 
location, laying, construction, maintaining and operation there- 
of. 

4306. Foreign Corporations. 

Corporations of other States or Territories, or of the United 
States, otherwise admissible to do business in this State may get 
the benefit of this article upon compliance with the laws and 



STATE STATUTES 705 

constitution of this State, including the provisions of Section 31, 
of Article IX, of the Constitution, but until such compliance 
they shall have no right in, on or under the highways. 

4307. Common Purchasers of Oil — Required to Purchase. 

Every corporation, joint stock company, partnership or other 
person, claiming or exercising the rights to cany or transport 
crude oil or petroleum or any of the products thereof, by pipe 
line for hire or otherwise, within the limits of this State, as al- 
lowed by, and upon compliance with the requirements of this 
article, as owner, lessee, licensee, or by virtue of any other right 
or claim, which is engaged in the business of purchasing crude 
oil or pertoleum therein shall be deemed a common purchaser 
thereof and shall purchase all of the petroleum in the vicinity 
of, or which may be reasonably reached by its pipe lines, or 
gathering branches, without discrimination in favor of one pro- 
ducer or one person as against another, and shall fully perform 
all the duties of a common purchaser; but if it shall be unable 
to perform the same, or shall be legally excusable from purchas- 
ing and transporting all of the petroleum produced, then it 
shall purchase and transport petroleum • from each person and 
producer ratably, in proporation to the average daily produc- 
tion; and such common purchasers are hereby expressly pro- 
hibited from discriminating in price or amount for like grades of 
oil, or facilities as between producers or persons; and in the 
event such purchaser is likewise a producer, it is hereby pro- 
hibited from discriminating in favor of its own production, or 
storage, or production or storage in which it may be interested, 
directly or indirectly in whole or in part, and its own produc- 
tion and storage shall be treated as that of any other person 
or producer. 

4308. Same — Exceptions. 

All persons, firms, associations and corporations are exempt 

from the provisions of this article where the nature and extent 

of their business are such that the public needs no use in the 

same and the conduct of the same is not a -matter of public cou- 

M. 0. R.— 45. . 



706 MORRISON'S OIL RIGHTS 

sequence and for this purpose the district courts of the State 
and the corporation commission are vested with jurisdiction to 
determine such exemptions in anj^ action or proceedings prop- 
erly before them, as provided in this article. 

4309. Oil Carriers Are Common Carriers — Discrimination 
Prohibited. 

Every corporation, joint stock company, partnership or per- 
son engaged in the business of carrying or transporting crude 
oil or petroleum or any of the products thereof for hire or other- 
wise, by pipe line, within this State, and by virtue of and in 
conformity to any valid law incapable of revocation by any laws 
of this State or of the- United States, or by virtue of and in 
conformity to ;the provisions of this, article, shall be deemed a com- 
mon carrier thereof as at common law,- and no such common 
carrier shall allow or be guilty of any unjust or unlawful dis- 
crimination, directly or indirectly, in favor of the carriage, 
transportation, storage or delivery of any crude stock or storage 
oil, or any product thereof, in its possession or control, or in 
which it may be interested, directly or indirectly. 

4310. Oil Carriers Not to Be Interested in Producing". 

It shall be unlawful for any corporation, joint stock company, 
partnership or person engaged in the business of carrying or 
transporting crude oil or petroleum, or any of the products 
thereof, for hire or otherwise, within the limits of this article, 
and not becoming a common purchaser as defined by, and ac- 
cepting the provisions of this article, to own or operate, directly 
or indirectly, any oil well, oil leases or oil holdings or interests 
in this State, and each of said corporations, joint stock compan- 
ies, partnerships or persons shall divest themselves of all legal 
or equitable ownership, interest or control, directly or indirect- 
ly, in oil wells, oil leases or oil holdings or interests in this State. 

4311. Acceptance of Laws and Plats to Be Filed. 

i 
Before any corporation, joint stock company, partnership or 

person shall have, possess, enjoy or exercise the right of eminent 



STATE STATUTES < 07 

domain, right of way, right to locate, maintain or operate pipe 
lines, fixtures or equipment thereunto belonging, or used in con- 
nection therewith, as authorized by the provisions of this article, 
or shall have, possess, enjoy or exercise any right (the word 
"right'' in this connection being used in its most comprehensive 
legal sense) conferred by this article, every such corporation, 
joint stock company, partnership or other person shall file in 
the office of the corporation commission a proper and explicit 
authorized acceptance of the provisions of this article and the 
constitution of this State, and, in cases of pipe lines, a plat show- 
ing in detail the points within this State between which, and the 
route along which, the trunk lines are proposed to be construct- 
ed, the intended size and capacity thereof, and the location and 
capacity of all pumping stations, gate valves, check valves and 
connections and appliances of all kinds used, or to be used, on 
said trunk lines; and upon demand of the corporation commis- 
sion., the proper parties, as required by said commission, shall 
promptly file a plat showing in detail all the lines owned and 
operated by them respectively, with full and explicit informa- 
tion as to their capacity, size and location, and the capacity of 
their pumping stations, gates valves, check valves and connec- 
tions, of all kinds, required or used in the operation thereof. 

4312. Domestic Pipe Line Companies Have Right of Way. 

Every domestic pipe line company in this State is hereby 
given authority to build, construct, lay and maintain oil pipe 
lines over, under, across or through all highways, bridges, streets 
or alleys in this State, or any public place therein, under the 
supervision of the inspector of oil and gas wells and pipe lines 
as to where and how in said highways, bridges, streets, alley and 
public places said pipe lines shall be laid, and subject to the 
control of the local municipalities, as to how the business of 
distribution in that municipality shall be conducted, and sub- 
ject to responsibility as provided by law for any negligent in- 
jury thereby caused. 

4313. Who May Have Right of Eminent Domain. 

Ail persons, natural or artificial, except foreign corporations, 



708 310KK1 SON'S OIL KIGHTS 

shall have the right of eminent domain, and any right or privi- 
lege hereby conferred, when necessary to make effective the pur- 
poses of this article and the rights thereby conferred. Foreign 
corporations organized under the laws of any other state, or the 
United States, and doing or proposing to do business in this 
State, and which shall have become a body corporate pursuant 
to or in accordance with the laws of this State, and which, as 
hereby provided, shall have registered its acceptance of the terms 
thereof, shall receive all the benefits provided by this article. 

4314. Commission May Extend Time. 

Upon a sworn statement of the necessities which would justify 
a judicial continuance, the corporation commission is authorized 
to extend the time for the filing of the said plats, not, however, 
to exceed sixty days. 

4315. Penalty for Violations. 

Any person, copartnership or corporation, its agent or em- 
ployee, violating any of the provisions of this article or any ord- 
er of the competent courts of this State, or the corporation com- 
mission, pursuant to the jurisdiction conferred by this article, 
shall upon conviction thereof, be fined a sum of not less than 
one thousand dollars, nor more than five thousand dollars, or 
imprisonment for not less than six months, nor more than one 
year, or by both such fine and imprisonment for each and every 
violation of this article ; but in case the monthly runs or takings 
or transportation of oil shall average so as to be without dis- 
crimination, as herein provided, the transactions of any particu- 
lar day, week or portion of a month shall be disregarded; and 
the competent Court of the county in which the omission or com- 
mission which is a violation of this article has occurred shall 
have jurisdiction of an action under the penal code for the pun- 
ishment thereof; and said penalties shall not be exclusive of 
civil liability. 

4316. Suspension of Penalty, When. 

Whenever the operation of a valid order of a competent court 



STATE STATUTES 709 

or the corporation commissi on is duly suspended according to 
law, the punitive provisions of this article shall likewise be sus- 
pended in their operation as to the transaction adjudicated in 
said court; and further, any Court having 1 jurisdiction of an 
action brought by the State to punish for a violation under the 
terms of this article, shall not impose a punishment therefor 
greater than five hundred dollars against any person or corpora- 
tion, if it finds from the evidence that the violation was made 
solely with the object of testing according to law the validity of 
any of the provisions of this article, or of the order of any com- 
petent Court or of the corporation commission, in any proceed- 
ing to carry out the provisions hereof. 

4317. Certified Transcript Shall Be Evidence. 

A properly certified transcript of the report of any such cor- 
poration, association or person shall, as against the maker there- 
of, be prima facie evidence of the truth of any matter therein 
contained. 

4318. Commission May Extend Time for Operation of Law. 

For good cause shown, the corporation commission is author- 
ized to extend the time within which this article shall operate 
as to any particular corporation, association or person, not to 
exceed nine months after the same becomes effective. 

Purchase of Gas from Foreign Corporations 

An Act permitting gas pipe line corporations and all municipal 
corporations to contract with and purchase from foreign corpora- 
tions or interstate pipe line companies, the supply of gas for their 
lines; and permitting the selling of natural gas for said purposes 
by interstate pipe line companies. 

Gas from Interstate Pipe Lines — License from Corporation 
Commission. 

Section 1. All domestic gas pipe line corporations in this 
State, which are now, or shall hereafter fully comply with the 



7.10 MORRISON'S OIL RIGHTS 

Jaws of this State, and all municipal corporations, owning or 
operating a gas plant, or which may hereafter own or operate 
a gas plant, may contract with and secure from foreign corpora- 
tions, operating interstate gas pipe lines, the supply of gas. for 
said domestic gas Companies. And interstate gas pipe line com- 
panies or foreign corporations may enter into said contract and 
deliver said gas, upon obtaining a license from the corporation 
commission, which is hereby authorized to grant a license to do 
and transact that particular business of supplying domestic cor- 
porations with natural gas, and the taking out of said license 
and the conduct of said business with domestic pipe line com- 
panies, shall not prejudice the said interstate pipe line com- 
panies, or foreign corporations in the transaction and conducting 
of their interstate business; provided, the corporation com- 
mission may revoke said license when, in its discretion, the pub- 
lic interest may be best subserved thereby. (Ch. 98, Session 
Laws 1913.) 

Foreign and Domestic Corporations to Have Separate Owner- 
ship. 

Sec. 2. No person or corporation, interested or doing business 
as an interstate gas pipe line company shall be interested in or 
own or control any stock of a domestic corporation, purchasing 
gas from an interstate pipe line company. Id. 

Act Regulating Carriage of Gas 

An Act to regulate corporations, associations, and persons en- 
gaged in this State, in the business of carrying natural gas 
through pipe lines ; to regulate operators of gas wells, regulating 
the purchase of natural gas by pipe lines, providing for viola- 
tions thereof, conferring jurisdiction in the corporation commis- 
sion for enforcement of the provisions of this Act, and declaring 
an emergency. 

Businesses and Persons Subject to the Act — Vested Rights Ex- 
cepted. 

Section 1. Every corporation, joint stock company, limited 



STATE STATUTES 711 

copartnership, partnership or other person, now or hereafter 
exercising or claiming- the right to carry or transport natural gas 
by or through pipe line or lines, for hire, compensation or other- 
wise, or now or hereafter exercising or claiming the right to 
engage in the business of producing, piping or transporting nat- 
ural gas, or any other person or persons, now or hereafter en 
gaging in the business of buying, selling in or transporting nat- 
ural gas within the limits of this state, shall not have or possess 
the right to conduct or engage in said business or operations, in 
whole or in part, as above described, or have or possess the right 
to locate, maintain, or operate the necessary pipe lines, fixtures 
and equipment thereto belonging, or use in connection there- 
with, concerning the said business of carrying or transporting 
natural gas as aforesaid, on, over, along, across, through, in or 
under any present or future highway, or part thereof, within the 
State, or to have or possess the right of eminent domain or any 
other right or rights, concerning said business or operation, in 
whole or in part, except as authorized by and subject to the 
provisions of this act, except, further, and only such right or 
riglits as may 'already exist which are valid, vested, and incap- 
able of revocation by any law of this State or of the United 
States. Act of March 26, 1913, chap. 99. 

Pipe Line Right-of-Way — Eminent Domain — Highways. 

Sec. 2. For the purpose of acquiring necessary right of way. 
every such person is hereby granted the right of condemnation 
by eminent domain, and in the use of the highways in this state, 
for the purpose of transporting natural gas by pipe lines, and 
the location, laying, constructing, maintaining and operations 
thereof. 

Pipe Line Operators Common Purchasers — Requirements — 
Exemptions. 

Sec. 3. Every corporation, joint stock company, limited co- 
partnership or other person, now or hereafter claiming or exer- 
cising the right to carr}^ or transport natural gas by pipe line or 
pipe lines, for hire, compensation, or otherwise, within the lim- 



712 .MORRISON'S OIL RIGHTS 

its of this State, is allowed by, and upon compliance with the 
requirements of this act, as owner, lessee, licensee, or by virtue 
of any other right or claim, which is now engaged or hereafter 
shall engage in the business of purchasing natural gas shall be 
a common purchaser thereof, and shall purchase all the natural 
gas m the vicinity of, or wiiich may be reasonably reached by 
its pipe lines, or gathering branches, without discrimination in 
favor of one producer or one person as against another, and 
shall fully perform all the duties of a common purchaser; but 
if it shall be unable to perform the same, or be legally excused 
from purchasing and transporting all the natural gas produced 
or offered, then it shall purchase and transport natural gas from 
each person or producer ratably, in proportion to the average 
production, and such common purchasers are hereby expressly 
prohibited from discriminating in price or amount for like 
grades of natural gas or facilities as between producers or per- 
sons ; and in the event it is likewise a producer, it is hereby pro- 
hibited from discrimination in favor of its owm production, or 
production in which it may be interested directly or indirectly 
in whole or in part, and its own production shall be treated as 
that of any other person or producer. All persons, firms, asso- 
ciations, and corporations are exempted from the provisions of 
this act, except from the provisions of section nine (9) hereof, 
where the nature and extent of their business is such that the 
public needs no use in the same, and^he conduct of the same is 
not a matter of public consequence, and for this purpose the dis- 
trict courts of the state and the Corporation Commission are 
hereby vested with jurisdiction to determine such exemptions in 
any action or proceeding properly before them, and provided by 
the laws now in force in this State regulating the purchase and 
transportation of oil. 

Pipe Line Operators to be Common Carriers — Obligations — 
Exemptions. 

Sec. 4. Every corporation, joint stock 'company, limited co- 
partnership, partnership or other person, now or hereafter en- 
gaged in the business of carrying or transporting natural gas for 
hire, for compensation or otherwise, by pipe Hues, within this 



state statutes flS 

State, and by virtue of and in conformity to, uny valid law in- 
capable of revocation by any law of this State or of the United 
States, or by virtue ,of and in conformity to the provisions of 
this Act, shall be a common carrier thereof as at common law, 
and no such common carrier shall allow or be guilty of any un- 
just or any unlawful discrimination, directly or indirectly, in 
favor of the carriage, transportation or delivery of any natural 
gas, offered to it, in its possession or control, or in which it may 
be interested, directly or indirectly. Provided, that any munic- 
ipality now owning or operating a gas pipe line for the purpose 
of furnishing gas for said municipality and now under contract 
with any person, firm or corporation to furnish it gas, shall be 
exempted from the provisions of this section during the life of 
said contract, or until changed or abrogated by the parties there- 
to. And, provided further, that any person, firm or corporation 
owning or operating a gas pipe line within the limits of any in- 
corporated city, or town in this State shall be exempted from the 
provisions of this section only as to its distributing lines located 
wholly within the corporate limits of said city or town. 

Non-Compliance with Act Made Unlawful — Effect. 

Sec. 5. It shall be unlawful for any corporation, joint stock 
company, limited copartnership, partnership or other person, 
now or hereafter engaged in the business of carrying or trans- 
porting natural gas for hire or compensation or otherwise, with- 
in the limits of this Act and not becoming a common purchaser 
as defined by, and accepting i be procisions of this Act, to own 
or operate, directly or indirectly, any gas well or wells, gas 
leases, or gas holdings or interests in this state, after six months 
next after the approval of this act, and each and every of said 
corporations, joint stock company, limited copartnership, part- 
nership or other persons shall divest themselves of all legal or 
equitable ownership, interest or control, directly or indirectly, 
in gas well or wells, gas leases or gas holdings or interests in 
this State. 



<14 MORRISON'S OIL RIGHTS 

Prerequisite to Carrying Gas — Records for Corporation Com- 
mission. 

Sec. 6. Before any corporation, joint stock company, limited 
copartnership, partnership or other persons shall have, possess, 
enjoy or exercise the right of eminent domain, right-of-way, 
right to locate, maintain or operate pipe lines, fixtures or equip- 
ment thereunto belonging, or used in connection therewith, as 
authorized by the provisions of this Act, or shall have, possess,. 
enjoy or exercise any right (the word "right" in this connection 
being used in its most comprehensive legal sense) conferred by 
this Act, every such corporation, joint stock company, limited 
copartnership, partnership or other person, shall file in the of- 
fice of said Corporation Commission proper and explicit author- 
ized acceptance of the provisions of this Act and the Constitu- 
tion of this State, in cases of pipe lines a plat showing in detail 
the points within this state between which, and the route along 
which the trunk lines are proposed to be constructed, the intend- 
ed size and capacity thereof, and the location and capacity of 
all pumping stations, gate valves, check valves and connections 
and appliances of all kinds used, or to be used, on said trunk or 
lines; and upon demand of the Corporation Commission the 
proper party or parties, as required by said commission, shall 
properly file a plat showing in detail all the lines owned and 
operated by them respectively, with full and explicit informa- 
tion as to their capacity, size and location, and the capacity of 
their pumping station, gate valves, check valves and connections 
of all kinds, respectively, required or used in the operation there- 
of. 

Right-of-Way — Highways — Eminent Domain. 

Sec. 7. Every domestic pipe line company in this State is here- 
by given authority to build, construct, lay and maintain gas pipe 
lines, over, under, across, or through all highways, bridges, 
streets or alleys in this State or any public place under the su- 
pervision of the Corporation Commission as to where and how 
in said highways, bridges, streets, alleys and public places said 
pipe lines shall be laid. Provided the right to lay gas pipe lines 



STATE STATUTES 7.15 

in cities shall be acquired as now provided by law, and subject 
to the responsibility as otherwise provided by law for any negli- 
gent injury thereby caused. All persons, natural or artificial, 
except foreign corporations, shall have the right of eminent do- 
main, and any right or privilege hereby conferred, when neces- 
sary to make effective the purposes of this act and the rights 
thereby conferred. Foreign corporations organized under the 
laws of any other State or Territory, or the United States, and 
doing or proposing to do business in this State, and which shall 
have became a body corporate pursuant to or in accordance with 
the laws of this State, and which, as hereby provided, shall have 
registered its acceptance of the terms hereof, shall receive all 
the benefits by this act provided. 

Filing Records with Corporation Commission — Extension of 
Time. 

Sec. 8. Upon a sworn statement of the necessities which would 
justify a judicial continuance, the Corporation Commission is 
authorized to extend the time for the filing of the said plats, not, 
however, to exceed 60 days. 

Only 25 Per Cent of Capacity of Gas Wells to Be Taken. 

Sec. 9. Every corporation, joint stock company, limited co- 
partnership or other person, now or hereafter claiming or exer- 
cising the right to produce natural gas, or to carry or to transport 
natural gas through pipe line or pipe lines, for hire, compensa- 
tion, or otherwise within the limits of this state, is allowed by, 
and upon compliance with the requirements of this act, as owner, 
lessee, licensee, or by virtue of any other right or claim, is here- 
by prohibited from taking more than twenty-five (25) per cent 
of the daily natural flow of any gas well or wells unless for good 
cMU.sc shown, under the exigencies of the particular case the Cor- 
poration Commission shall establish a different per centum un- 
der the prescribed rules and regulations therefor. 

Meters — Requirements. 

Sec. 10. No corporation, joint stock company, limited copart- 



716 MORRISON'S OIL RIGHTS 

nership, partnership or person doing business under the provi- 
sions of this act shall purchase, collect, transport, convey or sell 
any gas from any wells in this State except such gas as is run 
through properly constructed meters, the daily readings of 
which shall be carefully and accurately taken every twenty-four 
hours (24), and of which a true and correct report under oath 
shall be made every month and which report of all such busi- 
ness transacted during the next preceding month shall be hied 
not later than the fifteenth (15th) day of each and every month 
with the Corporation Commission and which report shall at all 
times be open to the inspection of the public. Such report shall 
be based upon such daily meter readings ; shall show the amount 
of gas run or purchased from each tract of lands ; lease or lease- 
hold estate, the names of the seller or sellers of such gas and of 
the purchaser or purchasers thereof ; and any person or persons 
making or directing, counseling, advising, aiding or abetting in 
the making or filing of any false report in the premises shall be 
deemed guilty of perjury, and on conviction thereof be punished 
as provided by law; and to the end that such meters shall be. 
properly constructed, maintained, repaired and operated, their 
installation, use and operation shall at all times be subject to 
such rules and regulations as the Corporation Commission may 
prescribe. 

Violation of Act — Punishment. 

Sec. 11. Any person, copartnership, or corporation, its agent 
or employees, violating any of the provisions of this Act, or any 
order of a Court of Competent Jurisdiction of this State, or 
the Corporation Commission, pursuant to the jurisdiction con- 
ferred by this act, shall, upon conviction thereof be fined a sum 
of not less than one thousand ($1,000.00) nor more than five 
thousand ($5,000.00), or imprisonment not less than six months, 
nor more than one year, or by both such fine and imprisonment 
for each and every violation of this act; but in case the monthly 
runs or takings or transportation of gas shall average so as to 
be without discrimination, as herein provided, a transaction or 
transactions of any particular day or week or portion of a month 
shall be disregarded; and the court of competent jurisdiction 



STATE STATUTES 717 

of the county in which the omission or commission, which is in 
violation of this act, has occurred, shall have jurisdiction of an 
action under the Penal Code for the punishment thereof; and 
i hiit said penalties shall not be exclusive of civil liability. 

Violations — Receivership — Procedure. 

Sec. 12. The Corporation Commission shall, upon being rea- 
sonably satisfied that any corporation has violated the provi- 
sions of this act, recommend to the Attorney General that a re- 
ceiver be appointed for such corporation. Upon receipt of the 
recommendation by the Attorney General, he shall within ten 
days file a petition on behalf of the State in any Court of com- 
petent jurisdiction, praying that a receiver be appointed, and 
such court shall immediately consider the application and ap 
point a receiver, if in the judgment of the Court the provisions 
of this Act have been willfully violated. The receiver, when 
appointed, shall immediately take charge of all the business, 
property and assets of such corporation in the State and shall 
retain possession thereof until it shall be determined upon the 
trial whether or not such corporation has violated the provisions 
of this Act, then, in addition to the other penalties herein pro- 
vided, all the property of said corporation shall be retained un- 
der such receivership until the penalties incurred hereunder are 
paid, after which the receivership may be discharged upon such 
terms and conditions as the Court may impose as an assurance 
for the further compliance with this Act. 

Evidence — Reports of Gas Companies. 

Sec. 13. A properly certified transcript of the report of any 
such corporation, association, or person, shall, as against the 
makers thereof, be prima facie evidence of the truth of any mat- 
ter therein contained. 

Enforcement by Corporation Commission— Appeals. 

Sec. 14. The Corporation Commission is hereby authorized 
and empowered to enforce all the provisions of this Act, includ- 
ing the employment of requisite help and gas experts to carry 



718 MORRISON'S OIL RIGHTS 

out the same, except when jurisdiction is conferred on some 
other branch of the State government by the Constitution of 
this State; appeals may be allowed from the decision of the 
Commission to the Supreme Court as now provided by law for 
appeals in other cases. 

Extension of Time for Operation of Act. 

Sec. 15. For good cause shown, the Corporation Commission 
is authorized to extend the time within which this Act shall 
operate as to any particular corporation, association or person 
not to exceed nine months after the same became effective. 

WASTE, PLUGGING AND INSPECTION 

4832. Waste. Oil Wells and Gas Wells Distinguished. 

Any person, copartnership, or corporation in possession, either 
as owner, lessee, agent or manager of any well producing natural 
gas, in this State in order to prevent the said gas wasting by 
escape, shall immediately after this Act takes effect, and imme- 
diately after penetrating the gas-bearing rock, in any well here- 
after drilled, shut in and confine the gas in said well until and 
during such time as the gas therein shall be. utilized for lights, 
fuel or power purposes: Provided, This shall not apply to any 
well operated for oil; provided, also, that when in the course 
of drilling gas production is developed, four days' free time 
shall be allowed in which to determine whether the well shall be 
shut and saved for a gas well or drilled in further for the pur- 
pose of producing oil. (L. 1909, H. B. 238. Took effect March 
27, 1909.) 

4833. Unnecessary Leaks. 

It shall be unlawful for any person, copartnership, or cor- 
poration, either as owner, lessee, agent or manager of any pipe 
line in this State, through which natural gas flows from wells 
utilized for the production of gas only, to allow any un necessary 
leak or waste to occur from said line. (L. 1909, H. B. 238. 
Took effect March 27, 1909.) 



STATE STATUTES 719 

4834. Jumbo and Flambeau Lights. 

It shall be unlawful to use natural gas for illuminating' pur- 
poses in what are known as flambeau lights; but nothing herein 
shall prohibit the use of "Jumbo" burners or other burners in 
glass globes consuming no more gas than such "Jumbo" burners, 
nor the burning of flambeau lights not to exceed four in num- 
ber within or near the derrick of any drilling well. (L. 1909, H. 
B. 238. Took effect March 27, 1909.) 

4835. Gas Light Curfew. 

The person, persons, firm, company or corporations consum- 
ing said gas, and using burners in open air or in or around 
derricks shall turn off said gas not later than eight o'clock in 
the morning of each day such lights or burners are used, and 
shall not turn on or relight the same between the hours of eight 
o'clock a. m. and five o'clock p. m. (L. 1909, H. B. 238. Took 
effect March 27, 1909.) 

4836. Daylight Use of Gas. 

No gas shall be used or burned for illuminating purposes 
between the hours of eight o'clock a. m., and five o'clock p. m., 
unless the use of the same is regulated by meter. (L. 1909, H. 
B. 23S. Took effect March 27, 1909.) 

4837. Streams to Be Protected. Salt Water. • 

No inflammable product from any oil or gas well shall be 
permitted to run into any tank, pool, or stream used for water- 
ing stock; and all waste of oil and refuse from tanks or wells 
shall be drained into proper receptables at a safe distance from 
the tanks, wells or buildings, and be immediately burned or 
transported from the premises, and in no case shall it be per- 
mitted to flow over the land. Salt water shall not be negligently 
allowed to flow over the surface of the land. (L. 1909, H. B. 
23§. Took effect March 27, 1909.) 

4838. Abandoned Wells How Plugged. 

All lessees or operators drilling or operating for crude oil 



720 MORRISON'S OIL RIGHTS 

or natural gas within the State of Oklahoma shall immediately 
in a practical and workmanlike manner under the supervision 
of the oil and gas inspector, as hereinafter provided, plug all 
dry or abandoned oil and gas wells in which oil or gas-bearing 
stratum has been found in the following manner: Beginning at 
the bottom of the hole, same shall be solidly filled with crushed 
rock or sand pumpings, or both, to a point twenty-five feet 
above the top level of the oil or gas-bearing sand; at that poiut 
a wooden plug of seasoned pine two feet in length and not less 
than one-half inch in diameter less than the inside diameter o£ 
the hole at that point shall be placed; thereafter the hole shall 
be filled up solidly twenty-five feet farther with a substance con- 
sisting of one-third portion of cement and two-thirds portion of 
sand, properly mixed with water; thereafter, another wooden 
plug of seasoned pine two feet in length and not less than one- 
half inch in diameter less than the inside diameter of the hole 
at the point shall be placed ; thereafter the hole shall be filled up 
solidly twenty-five feet further with crushed rock and said sand 
pumpings, or both ; and, Provided, further, that all such wells 
drilled to the Mississippi Line shall be plugged above the Miss- 
issippi Line in the same manner as provided for herein above, 
as to the plugging of wells in the upper oil and gas-bearing strat- 
um, all abandoned wells shall immediately be closed and marked, 
and, Provided, further, that when any such lessee or operator 
removes the derrick from and around such wells, he shall plug 
such wells in some good and substantial manner, at least ten 
feet below the' surface and fill such well from that point to the 
surface with such material as will prevent the well from caving 
before final abandonment. (L. 1909, H. B. 238. Took effect 
March 27, 1909.) 

4839. Chief Mine Inspector and Deputies of Oil and Gas. — 

Duties. 

The chief mine inspector shall appoint, subject to removal by 
him, such deputies of practical experience in operating and dril- 
ling oil and gas wells, and who are not directly or indirectly 
interested in the production of oil or gas as may be necessary to 
the full and prompt performance of the duties required by law. 



STATE .STATUTES 721 

The chief inspector or his deputies shall personally supervise 
the using and operating- of natural gas in this State, and the 
proper observance of the laws of the State dealing with the dril- 
ling for and production of oil and gas, or the piping, storagv, 
purchase and use thereof in this State, and shall promptly re- 
port any violation of such laws of (to) the county attorney of 
the county in which such violation may occur. Said chief miu •■ 
inspector shall designate one of his deputies to be chief deputy 
inspector of oil and gas wells and pipe lines, and all duly ap- 
pointed deputies shall reside at places convenient for the per- 
formance of their duties, and a record of their residence shall 
be kept on file in the office of the chief mine inspector, and be 
open to the inspection of all persons interested. 

The chief deputy inspector of oil and gas wells and pipe 
lines shall receive a compensation not to exceed two thousand 
($2,000) dollars' per annum and necessary traveling and main- 
tenance expenses wmile absent from home in the performance 
of their duties. (As amended May 17, 1913, Acts 1913, p. 459.) 

4840. Inspector or Deputy to Supervise Plugging. 

Whenever it becomes necessary to plug any well as required 
by law, the lessee or operator thereof shall at once notify, in 
writing, the inspector of gas and oil wells at the office of the 
Chief Mine Inspector or by personal written notification to the 
inspector of gas and oil wells at his residence, whereupon said 
inspector, or his deputy, shall repair to said well and supervise 
the plugging thereof. (L. 1909, H. B. 238. Took effect March 
27, 1909.) 

4841. Owner to Furnish Log to Inspector. 

Upon the arrival of said inspector, or his deputy, at the well 
to be plugged, the lessee or operator thereof shall furnish the 
inspector a record of the drilling of said well verified under 
oath, showing a true and correct log of the well. (L. 1909, H. 
B. 238. Took effect March 27, 1909.) 
M. O. K— 46. 



72-! MORRISON'S OIL RIGHTS 

4842. Setting Fires, 'interference with Pipes. 

It is hereby declared to be unlawful for any person or per- 
sons maliciously to set fire to any gas or oil escaping from wells, 
broken or leaking mains, pipes, valves, tanks or other appliances, 
used by any person, company or corporation in conveying gas 
or oil, or to interfere in any manner with the wells, pipes, mains, 
gate boxes, valves, stop-cocks, or other appliances, machinery or 
property of any person, company, or corporation engaged in 
furnishing gas or oil unless employed by or acting under the 
authority and direction of any such person, company or corpora, 
tion owning or operating said gas or oil lines or the proper legal 
authorities. (L. 1909, H. B. 238. Took effect March 27, 1909.) 

4843. Penalties imposed. 

Any person, copartnership, or corporation violating any of 
the provisions of this Act, shall upon conviction thereof, be 
fined in any sum not less than twenty-five dollars, nor more than 
five hundred dollars, in any court having competent jurisdic- 
tion in the county in which the Act shall have been committed 
or omitted, or by being imprisoned for not less than thirty days 
nor more than ninety days, or by both such fine and imprison- 
ment. The amount of said penalty, when collected shall be paid 
one-half into the public road fund, of the county in which said 
suit shall have been brought, and one-half to the informer in said 
action. (L. 1909, H. B. 238. Took effect March 27, 1909.) 

The Act of 1905 p. 309 as to plugging and waste of gas seems 
to be superseded by the later Act below printed. 

Act as to Ownership of Gas 

An Act defining ownership of natural gas, providing for the 
taking of same and making it larceny to take natural gas except 
as herein provided. 

Surface Owners Own the Gas. 

Section 1. All natural gas under the surface of any land in 
this State is hereby declared to be and is the prppertj of the 



STATE STATUTES 723 

owners, or gas lessees, of the surface under which gas is located 
in its original State. Act May 16, 1913, p. 439. 

Attempt to Equalize Division of Product. 

Sec. 2. Any owner, or oil and gas lessee, of the surface hav- 
ing the right to drill for gas shall have the right to sink a well 
to the natural gas underneath the same and to take gas there- 
from until the gas under such surface is exhausted. In case 
other parties, having the right to drill into the common reser- 
voir of gas, drill a well or wells into the same, then the amount 
of gas each owner may take therefrom shall be proportionate to 
the natural flow of his well or wells to the natural flow of the 
well or wells of such other owners of the same common source 
of supply of gas, such natural flow to be determined by any 
standard measurement at the beginning of each calendar month ; 
provided, that not more than twenty-five per cent of the natural 
flow of any well shall be taken, unless for good cause shown, ant} 
upon notice and hearing the corporation commission may, by 
proper order, permit the taking of a greater amount. The 
drilling of a gas well or wells by any owner or lessee of the 
surface shall be regarded as reducing to possession his share 
of such gas as is shown by his well. Id. 

Corporation Commission to Divide among Gas Owners. 

Sec. 3. Any person, firm or corporation taking gas from a 
gas field, except for purposes of developing a gas or oil field, 
and operating oil wells, and for the purpose of his own domestic 
use, shall take ratably from each owner of the gas in propor- 
tion to his interest in said gas, upon such terms as may be 
agreed upon between said owners and the party taking such, or 
in case they cannot agree at such a price and upon such terms 
as may be fixed by the corporation commission after notice and 
hearing; provided That each owner shall be required to deliver 
his gas to a common point of delivery on or adjacent to the 
surface overlying such gas. Id. 



724: MORRISON'S OIL BIGHTS 

Excess Share of Gas. 

Sec. 4. Any person, firm or corporation taking more than his 
or its proportionate share of such gas, in violation of the provi 
sions of this Act, shall be liable to any adjoining well owner 
for all damages sustained thereby and subject to a penalty for 
each violation not to exceed five hundred dollars ($500), and 
each day such violation is continued shall be a separate offense. 
Id. 

Violations Made Penitentiary Offense. 

Sec. 5. Any person or agent of a corporation who takes gas, 
or aids or abets in the taking of gas, except as herein provided, 
either directly or indirectly, as an individual, officer, agent or 
employee of any corporation shall be guilty of grand larceny 
and upon conviction thereof, shall be sentenced to the peniten- 
tiary not to exceed five (5) years. Id. 

Act to Prevent Waste 

An Act to conserve natural gas in the State of Oklahoma, to 
prevent waste thereof, providing for the equitable taking and 
purchase of same, conferring authority on the Corporation Com- 
mission, prescribing a penalty for violation of this Act, repealing 
certain Acts, and declaring an emergency. 

Implied Waste of Gas. 

That the production of natural gas in the State of Oklahoma, 
in such manner, and under such conditions as to constitute 
waste, shall be unlawful. Sec. 1, Act 1915, p. 326. 

Enlarged Definition of Waste. 

That the term waste, as used herein in addition to its ordi- 
nary meaning, shall include escape of natural gas in commercial 
quantities into the open air, the intentional drowning with 
water of a gas stratum capable of producing gas in commercial 
quantities, underground waste, the permitting of any natural 



STATUE STATUTES 725 

gas well to wastefully burn and the wasteful utilization of such 
gas. See. _!. Id. 

Conservation of Gas under Corporation Commission. 

That whenever natural gas in commercial quantities or a gas 
bearing stratum, known to contain natural gas in such quantity, 
is encountered in any well drilled for oil or gas in this State, 
such gas shall be confined to its original stratum until such time 
as the same can be produced and utilized without waste, and all 
such strata shall be adequately protected from infiltrating waters. 
Any unrestricted flow of natural gas in excess of two million 
cubic feet per twenty-four hours shall be considered a commercial 
quantity thereof; provided, that if in the opinion of the cor- 
poration Commission, gas of a lesser quantity shall be of com- 
mercial value, said Commission shall have authority to require 
the conservation of said gas in accordance with the provisions 
of this Act; and provided, further, the gauge of the capacity of 
any gas well shall not be taken until such well has been allowed 
an open flow for the period of three days. Sec. 3, Id. 

Power of Commission to Distribute Gas. 

That whenever the full production from any common source 
of supply of natural gas in this State is in excess of the market 
demands, then any person, firm or corporation having the right 
to drill into and produce gas from any such common source. of 
supply, may take therefrom only such proportion of the natural 
gas that may be marketed without waste, as the natural flow of 
the well or wells owned or controlled by any such person, firm 
or corporation bears to the total natural flow of such common 
source of supply having due regard to the acreage drained by 
each well, so as to prevent any such person, firm or corporation 
securing any unfair proportion of the gas therefrom; provided, 
that the corporation Commission may by proper order permit 
the taking of a greater amount whenever it shall deem such tak- 
ing reasonable or equitable. The said Commission is authorize 1 
and directed to prescribe rules and regulations for the deter- 
mination of the natural flow of any such well or wells, and to 



72b' MORRISON'S OIL RIOLL'IS 

regulate the taking of natural gas from any or all such common 
sources of supply within the State, so as to prevent waste, pro- 
tect the interests of the public, and of all those having a right 
to produce therefrom, and to prevent unreasonable discrimina- 
tion in favor of any one such common source of supply as against 
another. Sec. 4, Id. 

Equitable Distribution to Common Purchasers. 

Sec. 5. That every person, firm or corporation, now or here- 
after engaged in the business of purchasing and selling natural 
gas in this State, shall be a common purchaser thereof, and 
shall purchase all of the natural gas which may be offered for 
sale, and which may reasonably be reached by its trunk lines 
or gathering lines without discrimination in favor of one pro- 
ducer as against another or in favor of any one source of supply 
as against another, save as authorized by the corporation 
Commission after due notice and hearing; but if any such per- 
son, firm or corporation shall be unable to purchase all the gas 
so offered, then it shall purchase natural gas from each producer 
ratably. It shall be unlawful for any such common purchaser 
to discriminate between like grades and pressures of natural 
gas, or in favor of its own production, or of production in which 
it may be directly or indirectly interested either in whole or in 
part, but for the purpose of prorating the natural gas to be 
marketed, such production shall be treated in like manner as that 
of any other producer or person, and shall be taken only in the 
ratable proportion that such production bears to the total produc- 
tion available for marketing. The corporation Commission shall 
have authority to make regulations for the delivery, metering 
and equitable purchasing and taking of all such gas and shall 
have authority to relieve any such common purchaser, after clue 
notice and hearing from the duty of purchasing gas of an in- 
ferior quality or grade. Sec. 5, Id. 

Judicial Power Conferred on Corporation Commission. 

That any person, firm or corporation, or the Attorney Creneral 
on behalf of the State may institute proceedings before the cor- 



STATE STATUTES 727 

poration Commission, or apply for a hearing before said Com- 
mission, upon any question relating' to the enforcement of this 
Act; and jurisdiction is hereby conferred upon said Commis- 
sion to hear and determine the same, said Commission shall set 
a time and place when such hearing shall be had and give rea- 
sonable notice thereof to all persons or classes interested therein, 
by publication in some newspaper or newspapers having general 
circulation in the State, and shall in addition thereto cause no- 
tice to be served in writing upon any person, firm or corporation, 
complained against in the manner now provided by law for 
serving summons in civil actions. In the exercise and enforce- 
ment of such jurisdiction said Commission is authorized to sum- 
mon witnesses, make ancillary orders, and use such means and 
final process, including inspection and punishment as for con- 
tempt, analogous to proceedings under its control over public 
service corporations as now provided by law. Sec. 6, Id. 

Review by Supreme Court. 

That appellate jurisdiction is hereby conferred upon the 
Supreme Court of this State to review the orders of said Com- 
mission made under this Act. Such appeal may be taken by any 
person, firm or corporation, shown by the record to be interested 
therein, in the same manner and time as appeals are allowed by 
law from other orders of the corporation Commission. Said 
orders so appealed from may be superseded by the Commission 
or by the Supreme Court upon such terms and conditions as may 
be just and equitable. Sec. 7, Id. 

Corporation Commission to Make Rules and Regulations. 

Sec. 8. That the corporation Commission shall have authority 
to make regulations for the prevention of waste of natural gas, 
and for the protection of all natural gas, fresh water, and oil 
bearing strata encountered in any well drilled for oil or natural 
gas, and to make such other rules and regulations, and to em- 
ploy oi- appoint such agents with the consent of the Governor 
as may be necessary to enforce this Act. Sec. 8, Id. 



728 MORRISONS nil, RIGHTS 

Acceptance of Act to Be Filed. 

Before any person, firm or corporation shall have, possess, en- 
joy or exercise the right of eminent domain, right of way, right 
to locate, maintain or operate pipe lines, fixtures on, or equip- 
ments belonging thereto or used in connection therewith, for 
the carrying or transportation of natural gas, whether for hire 
or otherwise, or shall have the right to engage in the busi- 
ness of purchasing, piping or transporting natural gas as a 
public service or otherwise, such person, firm or corporation 
shall file in the office of the corporation Commission a proper 
and explicit authorized acceptance of the provisions of this Act. 
Sec. 9, Id. 

Duties of Mine Inspector. 

That nothing contained in this Act shall be construed to inter 
fere with any duties now imposed by law upon the Chief Mine 
Inspector of the State or his deputies. Sec. 10, Id. 

Separate Construction to the Several Sections. 

Sec. 11. That the invalidity of any section, subdivision, clause 
or sentence of this Act, shall not in any manner affect the 
validity of the remaining portion thereof. Sec. 11, Id. 

Penalties of Fine and Imprisonment. 

Sec. 12. That in addition to any penalty that may be im- 
posed by the corporation Commission for contempt, any person, 
firm or corporation, or any officer, agent or employee thereof, 
directly or indirectly violating the provisions of this Act, shall 
be guilty of a misdemeanor, and upon conviction thereof, in a 
Court of competent jurisdiction, shall be punished by a fine in 
any sum not to exceed five thousand dollars ($5,000), or by 
imprisonment in the county jail, not to exceed thirty (30) days, 
or by both such fiue'mul imprisonment, Sec. 12, Id. 



STATE STATUTES 72!) 

PUBLIC UTILITIES ACT 

Definition of Terms— ' Public Utilities." 

Section 1. The term "public utility," as used in this Act, shall 
be taken to mean and include every corporation, association, 
company, individuals, their trustees, lessees, or receivers, succes- 
sors or assigns, except cities, towns, or other bodies politic, that 
now or hereafter may own, operate, or manage any plant or 
equipment, or any part thereof, directly or indirectly, for pub- 
lic use, or may supply any- commodity to be furnished to the pub- 
lic. 

(a) For the conveyance of gas by pipe line. 

(b) For the production, transmission, delivery or furnishing 
of heat or light with gas. 

(c) For the production, transmission, delivery or furnishing 
electric current for light, heat or power. 

(d) For the transportation, delivery or furnishing of water 
for domestic purposes or for power. 

The term ''Commission" shall be taken to mean corporation 
Commission of Oklahoma. 

Commission's Jurisdiction over Public Utilities. 

Sec. 2. The Commission shall have general supervision over 
all public utilities, with power to fix and establish rates and to 
prescribe rules, requirements and regulations, affecting their 
services, operation, and the management and conduct of their 
business-; shall inquire into the management of the business 
thereof, and the method in which same is conducted. It shall 
have full visitorial and inquistorial power to examine such pub- 
lic utilities, and keep informed as to their general conditions, 
their Capitalization, rates, plants, equipments, apparatus, and 
other property owned, leased, controlled or operated, the value 
of same, the management, conduct, operation, practices and serv- 
ices; not only with respect to the adequacy, security and ae 
eommodation afforded by their service, but also with respect to 
their compliance with the provisions of this Act, and with the 



7oO -MORRISON'S OIL RIGHTS 

Constitution and laws of this State, and with the orders of the 
Commission. 

Implied Powers of Commission — Contempt. 

Sec. 3. In addition to the powers enumerated, specified, men- 
tioned or indicated in this Act, the Commission shall have all 
additional implied and incidental powers w r hich may be proper 
and necessary to carry out, perform and execute all powers here- 
in enumerated, specified, mentioned, or indicated, and to punish 
as for contempt such corporation, association, company or in- 
dividual, their trustees, lessees, receivers, successors and assigns, 
for the disobedience of its orders in the manner provided for 
punishment of transportation and transmission companies, by 
the Constitution and laws of this State. 

Records of Public Utility Business. 

Sec, 4. In case of the owner or operator of any public utility 
is engaged in carrying on any other business in connection with 
the operation of such public utility, the Commission may require 
the cost of the operation and gross revenues of such joint busi- 
ness to be kept in such form and manner as may be prescribed 
by the Commission so that the cost of the operation and gross 
revenues of the public utility may be ascertained. 

Orders of Commission — Scope — Right of Appeal. 

Sec. 5. The Commission may, from time to time, adopt or 
promulgate, such orders, rules, regulations or requirements, re- 
lative to investigations, inspections, tests, audits, and valuations 
of the plants and properties relative to inspection and tests of 
meters as in its judgment may be necessary and proper; pro- 
vided, that under the provisions of this Act, any public utility, 
corporation, association, company, individual, their trustees, 
lessees or receivers, successors, or assigns, may appeal from any 
order or finding or judgment of the Corporation Commission as 
provided by law m eases tried and heard before said Commission 
of transportation and transmission companies. 



state statutes 731 



Emergency. 



Sec. (3. For the preservation of the public health, peace and 
safety, an emergency is hereby declared to exist, by reason 
whereof this Act shall take effect and be in force from and after 
its passage and approval. (Ch. 93, Session Laws 1913.) 

WASTE AND CORPORATION COMMISSION ACT 

Waste of Oil Prohibited. 

Section 1. That the production of crude oil or petroleum in 
the State of Oklahoma, in such manner and under such condi 
tions as to constitute waste, is hereby prohibited. Acts of 1915, 

p. 28. 

Corporation Commission to Determine Value of Oil. 

Sec. 2. That the taking of crude oil or petroleum from any oil- 
bearing sand or sands in the State of Oklahoma at a time when 
there is not a market demand therefor at the well at a price 
equivalent to the actual value of such crude oil or petroleum is 
hereby prohibited, and the actual value of such crude oil or petro- 
leum at any time shall be the average value as near as may be as- 
certained in the United States at retail of the by-products of 
such crude oil or petroleum when refined, less the cost and a rea 
sou able profit in the business of transporting, refining and mar- 
keting the same, and the corporation Commission of this State 
is hereby invested with the authority and power to investigate 
and determine from time to time the actual value of such crude 
oil or petroleum by the standard herein provided,- and when so 
determined said Commission shall promulgate its findings by 
its orders duly made and recorded, and publish the same in some 
newspaper of general circulation in the State. Sec. 2, Id. 

Statutory Definition of Waste. Protection of Strata. 

Sec. 3. That the term "waste" as used herein, in additioii to 
its ordinary meaning, shall include economic waste, underground 
waste, surface waste, and waste incident to the production of 



732 MORRISON'S OIL RIGHTS 

crude oil or petroleum in excess of transportation or market- 
ing facilities or reasonable market demand. The corporation 
Commission shall have authority to make rules and regulations 
for the prevention of such waste, and for the protection of all 
fresh water strata, and oil and gas bearing strata, encountered 
in any well drilled for oil. Sec. 3, Id. 

Production of Oil from Common Source. Inequitable Distribu- 
tion Prohibited. 

Sec. 4. That whenever the full production from any common 
source of supply of crude oil or petroleum in this State can only 
be obtained under conditions constituting waste, as herein de- 
fined, then any person, firm or corporation, having the right to 
drill into and produce oil from any such common source of sup- 
ply, may take therefrom only such proportion of all crude oil 
and petroleum that may be produced therefrom, without waste, 
as the production of the well or wells of any such person, firm, 
or corporation, bears to the total production of such common 
source of supply. The corporation Commission is authorized to 
so regulate the taking of crude oil or petroleum from any or 
all such common sources of supply, within the State of Okla- 
homa, as to prevent the inequitable or unfair taking, from a 
common source of supply of such crude oil or petroleum, by any 
person, firm or corporation, and to prevent unreasonable dis- 
crimination in favor of any one such common source of supply 
as against another. Sec. 4, Id. 

Gauge of Well to Be Taken. 

Sec. 5. That for the purpose of determining such production, 
a gauge of each well shall be taken under rules and regulations 
to be prescribed by the corporation Commission, and said Com- 
mission is authorized and directed to make and promulgate, by 
proper order such Other rules and regulations, and to employ 
or appoint such agents with the consent of the Governor, as may 
be necessary to enforce this Act. Sec. 5, Id. 



STATE STATUTES 738 

Hearings Before Corporation Commission. May Punish for 
Contempt. 

Sec. 6. That any person, firm or corporation, or the Attorney 
General, on behalf of the State, may institute proceedings before 
the corporation Commission, or apply for a hearing- before said 
Commission, upon any question relating to the enforcement of 
this Act, and jurisdiction is hereby conferred upon said Com- 
mission to hear and determine the same. Said Commission shall 
set a time and place, when and where such hearing shall be had 
and give reasonable notice thereof to all persons or classes in- 
t'Mvsted therein, by publication in some newspaper or news- 
papers, having general circulation in the State, and in addition 
thereto, shall cause reasonable notice in writing to be served 
personally on any person, firm or corporation complained against. 
Jn the exercise and enforcement of such jurisdiction, said Com- 
mission is authorized to determine any question or fact, arising 
hereunder, and to summon witnesses, make ancillary orders, and 
use mesne and final process, including inspection and punish- 
ment as for contempt, analogous to proceedings under its con- 
trol over public service corporations, as now provided by law. 
Sec. 6, Id. 

Appeals to Supreme Court. Supersedeas. 

Sec. 7. That appellate jurisdiction is hereby conferred upon 
the Supreme Court in this State to review the action of said 
Commission in making any order, or orders, under this Act. 
Such appeal may be taken by any person, firm or corporation, 
shown by the record to be interested therein, in the same manner 
and time as appeals are allowed by law from other orders of 
the corporation Commission. Said orders so appealed from shall 
not be superseded by the mere fact of such appeal being taken, 
but shall be and remain in full force and effect until legally 
suspended or set aside by the Supreme Court. Sec. 7, Id. 

Contempt. Misdemeanor. 

Sec. 8. That in addition to any penalty that may be imposed 
by the corporation Commission for contempt, any person, firm 



?34 MORRISON'S OIL RIGHTS 

or corporation or any officer, agent or employee thereof, directly 
or indirectly violating the provisions of this Act, shall be guilty 
of a misdemeanor, and upon conviction thereof, in a Court of 
competent jurisdiction, shall be punished by a fine in any sum 
not to exceed five thousand dollars ($5,000), or by imprisonment 
in the county jail not to exceed thirty (30) days, or by both 
fine and imprisonment. Sec. 8 Id. 

State May Apply for Receiver. 

Sec. 9. That in addition to any penalty imposed under the 
preceding section, any person, firm or corporation violating the 
provisions of this Act, shall be subject to have his or its pro- 
ducing property placed in the hands of a receiver by a Court of 
competent jurisdiction, at the suit of the State through the At- 
torney General or any county attorney, but such receivership 
shall only extend to the operating of producing wells and the 
marketing of the production thereof, under the provisions of 
this Act, Sec, 9, Id. 

Construction of Act, 

Sec. 10. That the invalidity of any section, subdivision, clause 
or sentence of this Act shall not in any manner affect the va- 
lidity of the remaining portion thereof. Sec. 10, Id. 

OIL AND GAS DEPARTMENT ACT 

An Act for the creation of an oil and gas department under 
the jurisdiction of the corporation commissioners, to appoint a 
chief oil and gas conservation agent and conferring exclusive 
jurisdiction on the corporation commissioners in reference to the 
conservation of oil and gas and the inspection of gasoline and 
oil. and the product of crude petroleum, and repealing all acts or 
parts of acts in conflict therewith and declaring an emergency. 

Oil and Gas Department. Conservation Agent. 

Section 1. The corporation commission is hereby empow- 
ered and authorized to create and establish an oil and gas de 



JSTATE STATi TK< 735 

pftrtmefit under the jurisdiction and supervision of the corpo- 
ration commission, and is hereby authorized to appoint with 
the approval and consent of the Governor, a chief oil and gas 
conservation agent, who shall have charge of the oil and gas de- 
part ment herein authorized. Sec. 1, Act of 1917, p. 385. Ap- 
proved Feb. 16. 

Powers of Corporation Commissioner. 

Sec. 2. All authority and duties now conferred upon the cor- 
poration commission or other departments of the State govern- 
ment in reference to the conservation of oil and gas and the 
drilling and operating oil and gas wells and the construction and 
regulation of oil and "gas pipe lines, are hereby conferred ex 
clusively upon the corporation commmission. Sec. 2, Id. 

Corporation Commission to Prescribe Plugging Regulations. 

Sec. 3. The corporation commission is hereby authorized to 
prescribe rules and regulations for the plugging of all abandoned 
oil and gas wells. The same shall be plugged under the direction 
and supervision of the conservation agents of the corporation 
commission as may be prescribed by the corporation commis- 
sion. All orders and regulations in reference to plugging 
wells shall be made after general hearing as now prescribed by 
law for the promulgation of orders by the corporation commis- 
sion. Sec. 3, Id. 

Inspection of Oil and Oil Products. 

Sec. 4. Jurisdiction is hereby conferred upon the corporation 
commission to inspect all oils and liquids, the product of pe- 
troleum or other bituminous substances or into which the prod- 
uct of petroleum enters, by whatever name called, which may 
be or can be used for illuminating, heating or power purposes-, 
manufactured in this State or brought into it, before the same 
are consumed, used, sold or offered to be sold or disposed of 
to merchants, consumers or other persons within this State, 
and the corporation commission is hereby authorized to ap- 
point, with the approval of the Governor, oil inspectors who 



Toft MORRISON'S OIL RIGHT* 

shall perform the duties now prescribed by chapter 96, Session 
Laws 1915, and to perform such other duties as may be required 
by general rules and regulations of the corporation commis- 
sioner. Sec. 4, Id. 

Pay of Inspector. 

Sec. 5. The oil inspector hereby authorized shall receive the 
compensation now provided in chapter 96, Session Laws, 1915, 
for the inspection of oil and liquids. Sec. 5, Id. 

OIL LEASES ON STATE LANDS 

Commissioners of the Land Office May Lease School Lands. 

Sec. 1. The commissioners of the land office are authorized 
to lease for oil and gas purposes any of the school or other lands 
owned by the State of Oklahoma which such commissioners may 
deem valuable for oil and gas, for the term of five years and as 
long thereafter as oil or gas may be produced therefrom in pay- 
ing quantities, upon such terms and conditions and in such 
quantities as the commissioners shall by rules and regulations 
prescribe. Each such lease shall provide for the delivery to the 
State of a royalt}^ of not less than one-eighth part of the oil or 
gas produced from the leased premises or in lieu thereof the 
payment to the State of the market value of said royalty interest 
as the commissioners may elect. Such leasing shall be made by 
public competition after not less than thirty days' notice by 
publication in two newspapers authorized by law to publish legal 
notices, one of which newspapers shall be published at the State 
Capitol, and the other in the county where the land is situated. 
Such leasing shall be let by sealed bids and each lease awarded 
to the highest responsible bidder. Such oil and gas leases may be 
assigned only with the consent and approval of the commissioners 
of the Land Office. Provided, That the commissioners have the 4 
right to reject any and all bids. Act 1917, p. 462. 

Segregation of Oil Lands. 

Sec. 2. The commissioners are empowered to segregate any 



STATE STATUTES 737 

school or public lands for mineral purposes which the commis- 
sioners may, by order entered of record, determine to be val- 
uable for oil, gas or mineral purposes, and each agricultural, 
grazing or other lease of the surface rights or interest in any 
land so segregated shall reserve to the State, its lessees or 
grantees the right to explore, drill and operate for oil or gas on 
such lands as well as the right to enter upon the said lands and 
enjoy the mining rights so reserved. Id. 

Term of Lease, 5 Years. Appraisement on Quitting. 

Sec. 3. All oil and gas leases executed by the commissioners 
of the Land Office shall be for a term of five years, and as long 
thereafter as oil or gas may be produced in paying quantities; 
Provided, Upon the forfeiture or cancellation or surrender or ex- 
piration of the lease by reason of its termination on account of 
the five years' limit, provided for in the "Enabling Act," or any 
other cause, the school land commissioners shall provide for the 
leasing of such land in the same way and in the same manner 
that the school land commissioners lease land which has never 
been leased. Provided, On such leases which are surrendered or 
which may expire or which have expired, the lessees or assignees 
shall have the value of the physical properties on such lease, 
which value shall be determined by a board of appraisers es- 
pecially appointed by the school land commissioners for the 
appraising of physical property of leases. Provided,, No physical 
property valuation shall be attached or considered in the making 
of a lease on a tract consisting of more than 640 acres. If no 
well shall be completed upon any leased premises within one 
year from the date of the lease, the lessee shall pay to the State 
of Oklahoma, an annual rental in advance of such sum per acre 
as the commissioners shall prescribe in the lease, which payment 
shall operate to defer the completion of a well during the year 
for which such rental payment is made. Id. 

Conditions of Lease. Bond. 

Sec. 4. All leases for oil and gas shall contain a provision to 
drill one well on each leased tract within one year from the date 
M. O. R.— 47. 



738 MORRISON'S OIL RIGHTS 

of such lease, or on failure to complete such well to pay an 
annual rental per acre as hereinbefore provided. All such leases 
shall further provide that the lessee shall drill a sufficient num- 
ber of wells upon the leased lands to offset all producing wells 
upon any adjoining or contiguous lands, and a further provision 
that the failure of the lessee to diligently and in good faith 
operate the leased premises for oil and gas to as full an extent 
as other lands are operated in the general oil and gas field where 
such leased lands are located shall forfeit all rights of the lessee 
under such lease. Each lessee shall execute a bond to the State 
of Oklahoma with sureties to the approval of the commissioners 
and in such sum as the commissioners shall prescribe, conditioned 
for the faithful performance of the provisions of the lease and 
for the payment of all recoverable damages which such lessee 
may cause to the property, crops or rights of the surface lessee. 
Each lease shall further provide that in the event the State shall 
at any time operate a refinery for the refining of crude petro- 
leum or the extraction of any of its products or by-products, 
the State shall have the preference right to purchase and take 
the production or output of any such oil or gas well at the pre- 
vailing market price thereof, upon the commissioners serving 
written notice upon the owners of any well of the purpose and 
readiness of the State to take such production. Id. 

Commissioners to Publish Rules. 

Sec. 5. The commissioners of the Land Office may adopt and 
promulgate appropriate rules and regulations for carrying into 
effect the provisions of this Act; but no restrictions or prohibi- 
tions against any bidder or prospective bidder shall be made, 
other than as provided in this Act. Id. 

Surface Injuries. 

Sec. 6. The lessee under any oil or gas lease executed by the 
commissioners of the Land Office shall be liable to the surface 
owner or lessee for all injury, damage or loss occurring to the 
surface interest, interest in such lands or to any building, crops 



STATE STATUTES 739 

or improvements or other property located upon or used in con- 
nection with said land. Id. 

Disposition of Bonuses and Royalties. 

Sec. 7. All funds arising from bonuses, roj r alties or rentals 
for oil and gas leases shall be carried into and credited to the 
permanent funds for the use- and purpose designated in the grant 
of such lands by Congress to the State of Oklahoma, and all such 
funds shall be kept, handled, and used in like manner as other 
moneys belonging to said permanent funds. Id. 

License to Foreign Corporation to Sell Gas 

Interstate Pipe Lines.. — License required. 

Section 1. All domestic gas pipe line corporations in this 
State which are now, or shall hereafter fulty comply with the 
laws of this State, and all municipal corporations, owning 1 
operating a gas plant, or which may hereafter own or operate 
a gas plant, may contract with and secure from foreign cor- 
porations, operating interstate gas pipe lines, the supply of gas 
for said domestic gas companies. And said interstate gas pipe 
line companies or foreign corporation may enter into said con- 
tract and deliver said gas, upon obtaining a license from the 
corporation Commission, which is hereby authorized to grant a 
license to do and transact that particular business of supplying 
domestic corporations with natural gas, and the taking out of 
said license and the conduct of said business with domestic pipe 
line companies, shall not prejudice the said interstate pipe line 
companies, or foreign corporations in the transaction and con- 
ducting of their interstate business; provided, the corporation 
Commission may jrevoke said license when, in its discretion, the 
public interest may be best subserved thereby. Act March 26, 
1913, p. 165. 

Interlocking Foreign and Domestic Pipe Lines. 

Sec. 2. No person or corporation, interested or doing business 
as an interstate gas pipe line company, shall be interested in or 



740 MORRISON'S OIL RIGHTS 

own or control any of the stock of a domestic corporation, pur- 
chasing gas from interstate pipe line company. Id. 

STANDARD METERS 

Municipal Gas Companies to Use Standard Meters. 

Sec. 1. That all persons, firms, corporations or other business 
organizations engaged in the business of furnishing natural gas 
in municipalities in this State, to the inhabitants thereof, shall 
do so through standard meters at meter rates; provided, that 
this Act shall only apply to towns where the population exceeds 
five hundred, and shall not prohibit the sale of gas at a flat 
rate of Federal, State or municipally owned buildings, institu- 
tions or plants; provided, further, that this Act shall not ab- 
rogate any existing contract or affect or change the terms or 
conditions of any franchise granted by any municipal corpora- 
tion prior to and in effect April 28, 1913. Sec. 1, Act 1915, p. 
333, amending Act of 1913, p. 309. 

Fines Imposed. 

Sec. 2. Any person, firm, corporation or other business or- 
ganization who shall violate any of the provisions of this Act. 
shall be guilty of a misdemeanor and, upon conviction, shall be 
fined not less than five dollars nor more than twenty-five dollars, 
and each day of such violation shall be deemed a separate of- 
fense. Sec. 2, Id. 



PENNSYLVANIA. 

Wells to Be Plugged Against Water. 

All owners of and operators of oil lands within this common- 
wealth shall in a practical manner plug their wells, at proper 
depth, with wood and sediment, in a manner sufficient to ex- 
clude all fresh water from the oil-bearing rock, and to prevent 



STATE STATUTES • 741 

the flow of oil or gas into fresh water. See. 1, Act 187, p. 
56. Pardon's Digest, p. 3342. 1 

Fine for Omission. 

Any person found guilty of violating the provisions of this 
Aet shall be fined in any sum not less than twenty nor more 
than one hundred dollars for each and every offense, which 
shall be paid, one-half to the informer and the other half to 
the school district in which the offense is committed; which 
shall be collected as fines of like manner are by law collected. 
Sec. 2, Id 

Ad joiners, When May Plug. 

Whenever the owner of any well has abandoned the same 
or does not reside in the county in which it is situated, any 
person owning property adjoining may enter in and take pos- 
session of any well, for the purpose of carrying out the pro- 
visions of the first section of this Act, where the owner has 
refused or neglected to plug said well, so as to shut off the fresh 
water from the oil rock and excludes the gas and oil from the 
fresh water, as provided in section first at the expense of the 
owner. Sec. 3, Id. 

Details of Plugging". 

AVhenever any well shall have been put down for the purpose 
of exploring for and producing oil, upon abandoning or ceasing 
to operate the same, the owner or operator shall, for the purpose 
of excluding all fresh water from the oil-bearing rock, and be- 
fore drawing the casing, fill up the well with sand or rock sedi- 
ment to the depth of at least twenty feet above the third sand 
or oil-bearing rock, and drive a round, seasoned, wooden plug 
at least two feet in length, equal in diameter to the diameter of 
the well below the easing, to a point at least five feet below the 

1A11 the Pennsylvania Statutes printed under this head, unless other- 
wise noted, are found in Purdon's Digest, 3 3th Ed. pp. 3342-3345, 3505- 
3507 and 3533-3535. 



742 ' . MORRISON'S OIL RIGHTS 

bottom of the casing and immediately after the drawing of the 
casing, shall drive a round wooden plug into the well, at the 
point just below where the lower end of the casing shall have 
rested, which plug shall be at least three feet in length, tapering 
in form, and to be of the same diameter at the distance of eigh- 
teen inches from the smaller end, as the diameter of the well 
below the point at which it is to be driven; (and) after it has 
been properly driven, shall fill in on top of same with sand or 
rock sediment, to the depth of at least five feet. Sec. 1, Act 
June 10, 1881, p. 110. 1 

Penalty $200. 

Any person who shall violate the provisions of this Act shall 
be liable to a penalty of two hundred dollars, one-half to be for 
the use of the informer 1 , and one-half to the use of school district 
in which such well may be situated, to be recovered as debts of 
like amount are by law recoverable. Act June 10, 1881, p. 110, 
sec. 2, Id, 

Adjoining Owners May Plug. 

^Vhenever any owner or operator shall neglect or refuse to 
comply with the provisions of section 1 of this Act, the owner of, 
or operator upon any land adjoining that upon which such 
abandoned well may be, may enter, take possession of said aban- 
doned well and plug tho same as provided by this Act, at the 
expense of the owner or operator whose duty it may be to plug 
the same. Id., § 3. 

The 3 sections above printed are found in Purdon's Digest, 
13th Ed., p. 3342. 

Details of Plugging and Filling. 

Whenever any Well shall have been put down on lands of 
any person, or corporation, for the purpose of exploring for 
or producing gas, upon abandoning or ceasing to operate the 

1 This Act is construed in Dawsson v. Shaw, 28 Pa. Supr. Ct. 563 and 
Bartoe v. Guckert, 158 Pa. 124. 



STATE STATUTES 743 

same, the person, or corporation, drilling or owning the well, 
shall, before drawing the easing, fill yip the well with* sand, 
or rock sediment, to the depth of at least twenty feet above the 
gas-bearing rock, and drive a round seasoned wooden ping, at 
least two feet in length, equal in diameter to the diameter of the 
well below the casing, to a point at least five feet below the 
bottom of the casing, and, immediately after the drawing of 
the casing, shall drive a round wooden plug into the well, at 
the point just below where the lower end of the casing shall 
have rested, which plug shall be at least three feet in length, 
tapering in form, and to be of the same diameter at the dis- 
tance of eighteen inches from the small end of the diameter of 
the well below the point at which it is to be driven. After the 
plug ha"s been properly driven, there shall be filled in on the 
top of the same, sand or rock sediment, to the depth of at 
least five feet. Sec. 2, Act 1885, p. 145. 

Penalty $200. 

Any person who shall violate the provisions of the preceding 
section, shall be liable to a penalty of two hundred dollars, to 
be recovered as debts of like amount are by law recoverable. 
Sec. 3, Id. 

When Adjoining Owners May Plug. 

Whenever any person shall neglect, or refuse to comply with 
the provisions of this Act, with regard to plugging wells, any 
owner of lands adjacent, or in the neighborhood of such un- 
plugged well, .may enter and take possession of said abandoned 
well, and plug the same, as provided by this Act, at the expense 
of the person, or company, whose duty it may have been to 
plug the same. Sec. 4, Id. 

Duty to Prevent Escape of Salt Water. 

Upon the abandonment or ceasing to operate or use any well 
wfrich shall have been drilled for oil or gas, it shall be the duty 
of the person or persons interested in such well, to plug the same 
so as to completely shut off. and prevent the escape of all water 



<44 MORRISON'S OIL RIGHTS 

therefrom which may be impregnated with salt or other sub- 
stances which shall render such water unfit for use for domestic, 
steam-making or manufacturing purposes, and in such manner 
as to prevent water from any such well injuring or polluting 
any spring, water well or stream which is or may be used for the 
purposes aforesaid. Sec. 1, Act 1891, p. 122. 

Penalty. 

Any person violating the provisions of this Act shall be 
deemed guilty of a misdemeanor, and shall be sentenced, upon 
conviction thereof to pay a fine of not more than one thousand 
dollars, or to undergo an imprisonment for a period not ex- 
ceeding six months, or both, or either, at the discretion of the 
Court. Sec. 2, Id. 

Interested Party May Plug Well. 

Whenever any person may be injured by neglect or refusal 
to comply with the first section of this Act, it shall be lawful 
for such person, after notice to the owner or lessee of the 
premises upon which such well is located, to enter upon and 
fill up and plug such well in the manner directed by the first 
section hereof, and thereupon to recover the expense thereof 
from the person or persons whose duty it was to plug and fill 
up said well, in like manner as debts of such amounts are re- 
coverable. Sec. 3 Id. 

Accounting between Cotenants of Oil Wells. 

From and after the passage of this Act any person or persons 
performing labor of any kind whatever, or furnishing material 
for, upon or about any drilling, pumping or producing oil or 
gas well shall have the right to bring suit in assumpsit against 
any joint owner, joint tenant or tenant in common holding an 
interest in and operating such drilling, pumping or producing 
oil or gas well, to recover from such joint owner, joint tenant, 
or tenant in common, the pro rata share due and owing by such 
joint owner, joint tenant, or tenant in common for any labor 
done, or materials furnished, in, upon or about such drilling, 



STATE STATUTES 74f> 

pumping or producing oil or gas well, and the interest of such 
joint owner, joint tenant, or tenant in common shall be subject 
to levy and sale upon an}' execution issued to enforce collection 
of any claim under this Act, after judgment obtained by due 
process of law. Sec. 1, Act 1891, p: 41. 

Idem. Non-joining Co-owner Not Bound. 

Any joint owner, joint tenant or tenant in common, paying 
the pro rata share of the necessary expenses of any drilling, 
producing or pumping oil or gas well for any other joint owner, 
joint tenant or tenant in common holding an interest in and 
operating such drilling, pumping or -producing oil or gas well 
shall have or possess all the rights of action, as provided in the 
first section of this Act, to the same extent as is given hereby 
to the person or persons performing the said labor or furnish- 
ing such materials : Provided, That no joint owner, joint tenant 
or tenant in common shall be required by this Act to pay any 
share of the expense of operations commenced and carried on 
without his authority or consent. Sec. 2, Id. 

Malicious Injury to Well, Tank or Pipe. 

If any person shall willfully and maliciously injure any well 
sunk for the production of oil, or gas, or water, or any tank 
intended or used for the storage of oil, or gas, or water, or any 
line of pipe intended or used for the transportation of oil or 
Lias, or water, or any machinery connected with such wells, 
tanks or lines of pipe, he shall be guilty of a misdemeanor, 
and upon being thereof convicted, shall be sentenced to pay a 
fine not exceeding one thousand dollars, and undergo impris- 
onment, not exceeding three years, or both, or either, at the 
discretion of the Court. Sec. 1 Act 1885, p. 145. 

Mining Cotenants Act Extended to Oil. 

The provisions of an Act to enable joint tenants, tenants in 
common and adjoining owners of mineral lands in this com- 
monwealth to develop the same, passed the 21st day of April, 
1854, and the supplements thereto, be and the same are hereby 



/46 MORRISON'S OIL RIGHTS 

extended to mining for carbon oils, manufacturing, refining 
and selling, or conveying the same to market. Sec. 1, Act 1861, 
p. 438. 

Consolidation of Oil Mining Companies. 

The provisions of the Act, entitled "An Act relating to rail- 
road companies," passed May 16th, Anno Domini 1861, and 
the supplement thereto, entitled "A further supplement to an 
Act, entitled 'An Act relating to railroad companies,' passed 
May 16th, Anno Domini 1861," which supplement was approved 
the 23d day of March Anno Domini 1865, be and the same are 
hereby extended to oil and other mining companies. Act April 
18, 1867, P. L. 90, § 1. 

Merger of Oil Companies. 

Any two or more oil or other mining companies which shall, 
according to the provisions of said recited Acts, agree to merge 
or consolidate their rights and privileges granted to them under 
the laws of this commonwealth, are hereby authorized to assume 
such name as the board of directors selected by the joint action 
of said companies may designate, and also to fix the amount 
of the capital stock of said company after the consolidation, and 
designate the time and places of meeting of the board of 
directors: Provided, That immediately after said consolidation 
shall have been effected, it shall be the duty of said company 
to certify to the Secretary of the commonwealth the name of 
said company and the amount of its capital stock. Act April 
18, 1867, P. L. 90, § 2. 

Consolidation of Oil Companies. 

It shall be lawful for the president and directors, or a majority 
thereof of any oil or other mining company-, agreeing or de- 
sirous of accepting the provisions of this Act, to make such 
merger and consolidate in manner and form as hereinbefore 
provided. Act April 18, 1867; P. L. 90, § 3. 



4 STATE STATUTES 747 

Oil Companies May Hold Stock and Bonds of Other Companies. 

Corporations incorporated under the provisions of the Act, 
entitled "An Act to provide for the incorporation and regula- 
tion of certain corporations," approved April 29th, Anno 
Domini 1874, for the purpose of mining for petroleum, may 
subscribe for, purchase, hold and dispose of stock and bonds 
of any other corporation incorporated under the said Act for 
the same purpose, and may also subscribe for, purchase, hold 
and dispose of stocks and bonds of any corporation incorpo- 
rated under the provisions of the Act, entitled "An Act to 
provide for the incorporation and regulation of natural gas 
companies, approved the 29th day of May, Anno Domini 1885. 
And may also subscribe for, purchase, hold and dispose of 
stocks and bonds in any corporations of other States incorpo- 
rated for similar purposes : Provided, That the amount of such 
stock held by any corporation, together with the amount of its 
capital stock, shall not exceed, in the aggregate, the amount 
to which the capital of such corporations is limited by the 39th 
section of the Act to which this is a supplement. See. 1, Act 
1889, p. 76. 

Dissolution of Oil Corporations. 

AVhenever any corporation organized for the purpose of min- 
ing for petroleum or other products and marketing the same, 
and owning real estate in any county of this commonwealth, 
shall have been in existence for the period of thirty years or 
longer and for the period of ten years or more prior to the 
passage of this Act shall not have been engaged in the business 
of such mining, nor have earned and distributed to the share- 
holders thereof any dividends out of its net earnings, it shall be 
the duty of the Courts of common pleas of any county in which 
such real estate may be situated, upon the petition of the owner 
or owners of not less than one-third of the capital stock of any 
such corporation and after personal notice to other known stock- 
holders resident within the county, and notice to all others 
interested, by advertisement, in at least one newspaper of gen- 
eral circulation published within the county, for not less than 



<4b MORRISON'S OIL RIGHTS 

two months, if the facts alleged in the petition be not denied, or, 
if denied, shall be found by the Court to be true, to order and de- 
cree a dissolution of such corporation, and to order and direct 
the sale of the real estate thereof by a trustee to be appointed 
for that purpose, and to decree distribution of the proceeds of 
such sale or sales to and among creditors or shareholders entitled 
thereto, in the same manner that the real estate of other dis- 
solved corporations is now sold and the proceeds thereof distri- 
buted under the discretion of said Courts. Sec. 1, Act 1903, 
p. 79. 

Oil Transportation and Storage. 

Every corporation, company, association, person or persons 
who are now engaged, or shall hereafter engage or continue 
in the business of transporting or storing crude or refined 
petroleum, by means of pipe line or pipe lines, or storage by 
tanks, shall conduct such business in conformity with and sub- 
ject to the provisions of this Act. Sec. 1, Act 1878, p. 104. 

No Receipts or Vouchers Until Oil Delivered. 

No receipt, certificate, accepted order or other voucher shall 
be issued or put in circulation, nor shall any order be accepted 
or liability incurred for the delivery of any petroleum, crude 
or refined, unless the amount of such petroleum represented 
in or by such receipt, certificate, accepted order, or other 
voucher or liability, shall have been actually received by and 
shall then be in the tanks and lines, custody and control of the 
corporation, company, association, person or persons issuing 
or putting in circulation such receipt, certificate, accepted order 
or voucher, or incurring such liability. Sec. 2, Id. 

Duplicate Receipts, When Allowed. 

No duplicate receipt, certificate, accepted order or other 
voucher shall be issued or put in circulation, or any liability 
incurred for any petroleum, crude or refined, while any former 
liability remains in force or any former receipt, certificate, 
accepted order or other voucher shall be outstanding and un- 



STATE STATUTES 749 

cancelled, except in case such original paper shall have been 
lost; in which case a duplicate, plainly marked "duplicate" up- 
on the face, and dated and numbered as the lost original was 
dated and numbered, may be issued. Sec. 2, Id. 

Reissue of Vouchers Forbidden. 

No receipt, voucher, accepted order, certificate, or written 
evidence of liability of such corporation, association, company, 
person or persons, on which petroleum, crude or refined, has 
been delivered, shall be reissued, used or put in circulation. 
Sec. 2, Id. 

Receipts to Be Surrendered Unless Lost. 

No petroleum, crude or refined, for which a receipt, voucher, 
accepted order, certificate or liability incurred, shall have been 
issued or put in circulation, shall be delivered, except upon the 
surrender of the receipt, voucher, order or liability represent- 
ing such petroleum, except upon affidavit of loss of such in- 
strument made by the former holder thereof. Sec. 2, Id. 

Notice before Issue of Duplicate. 

No duplicate receipt, certificate, voucher, accepted order, or 
other evidence of liability shall be made, issued or put in cir- 
culation, until after notice of the loss of the original, and of the 
intention to apply for a duplicate thereof, shall have been 
given, by advertisement, over the signature of the owner thereof, 
in at least four successive issues of a daily or weekly newspaper 
published in the county where such duplicate is to be issued. 
Sec. 2, Id. 

Receipts How Cancelled. 

Every receipt, voucher, accepted order, certificate, or evi- 
dence of liability, when surrendered, or the petroleum repe- 
sented thereby delivered, shall be immediately cancelled, by 
stamping or puncturing the same across the face, in large and 
legible letters, with the word "cancelled," and giving the date 



750 MORRISON'S OIL RIGHTS 

of such cancellation ; and it shall then be filed and preserved 
in the principal office of such corporation, association, com- 
pany, person or persons. Sec. 2, Id. 

Written Order Required. 

No corporation, association, company, or the officers or agents 
thereof, or any person or persons engaged in the transporta- 
tion or storage of petroleum, crude or refined, shall sell or in- 
cumber, ship, transfer, or in any manner remove, or procure 
or permit to be sold, incumbered, shipped, transferred, or in 
any manner removed from the tanks or pipes of said corpora- 
tion, association, company, person or persons engaged in the 
business aforesaid, any petroleum, crude or refined, without 
the written order of the owner or owners thereof. Sec. 3, Id. 

Monthly Statements from Pipe Line and Storage Companies. 

Any corporation, association, company, and the officers, 
agents, managers and superintendents thereof, and any per- 
sons that are now or may hereafter be engaged or continue 
in the business of transportation by pipe lines, or storing crude 
or refined petroleum, shall, on or before the tenth day of each 
month, make or cause to be made, and posted in the principal 
business office where such corporation, company, association, 
person or persons is or are or may be engaged in business,' in 
an accessible and convenient place, for the examination thereof 
by any person desiring such examination, and shall keep so 
posted continuously until the next succeeding statement is so 
posted, a statement plainly written or printed, signed by the 
officer, agent, person or persons having charge of the pipes 
and tanks of said corporation, company, association, person or 
persons, and also by the officer or officers, person or persons, 
having; charge of the books and accounts thereof, which state- 
ment shall show, in legible and intelligent form, the following- 
details of the business : 

I. How much petroleum, crude or refined, was in the actual 
and immediate custody of such corporation, company, asso- 
ciation, person or persons, at the beginning and close of the 



STATE STATUTES 751 

previous mouth, and whore the same was located or held, describ- 
ing- in detail the location and designation of each tank or place 
of deposit, and the name of the owner; 

II. How mueh petroleum, crude or refined, was received by 
such corporation, company, association, person or persons, dur- 
ing the previous month : 

III. How much petroleum, crude or refined, was delivered 
by such corporation, company, association, person or persons, 
during the previous month: 

IV. How much petroleum, crude or refined, such corporation, 
company, association, person or persons, were liable for the de- 
livery or custody of, to other corporations, companies, associa- 
tions or persons, at the close of such month; 

V. How much of such liability was represented by outstand- 
ing receipts or certificates, accepted orders or other vouchers, 
and how much was represented by credit balances. 

The statements so required to be made, shall also be sworn 
to by said officers, agent, person or persons, before some other 
officers authorized by law to administer oaths, which oath shall 
be in writing, and shall assert the familiarity and acquaintance 
of the deponent with the business and condition of such cor- 
poration, company, association, person or persons, and with 
the facts sworn to, and that the statements made in the said 
report are true. 

VI. That all the provisions of this Act have been faithfully 
observed and obeyed, during the said previous months. Sec. 5, 
Id. 1 

Details of Statement. 

All the amounts in the statements required by this Act, when 
the petroleum is handled in bulk, shall be given in barrels and 
hundredths of a barrel, reckoning forty-two gallons to each 
barrel ; and when such petroleum is handled in barrels or pack- 
ages, the number of such barrels or packages shall be given; 
and such statements shall distinguish between crude and re- 
fined petroleum, and give the amount of each. Sec. 6, Id, 

1 There is no section 4 in the Act cited. 



tOZ MORRISON'S OIL RIGHTS 

Oil in Stock to Tally with Outstanding Orders. 

Every corporation, company, association, person or persons 
engaged in the business aforesaid, shall, at all times, have in 
their tanks and pipes an amount of merchantable oil equal to the 
aggregate of outstanding receipts, accepted orders, certificates, 
vouchers, acknowledgments,, evidences of liability, and credit 
balances upon the books thereof. Sec. 6, Id. 

Fine and Imprisonment both Imposed. 

Any corporation, association, company or officers or agents 
thereof, or person or persons who shall make or cause to be 
made, sign or cause to be signed, issue or cause to be issued, 
put in circulation or cause to be put in circulation, any re- 
ceipt, accepted order, certificate, voucher, or evidence of lia- 
bility, or shall sell, transfer or alter the same, or cause such 
sale, transfer or alteration, contrary to the provisions of this 
Act, or shall do or cause to be done any of the Acts pro- 
hibited by the second section of this Act, or omit to do any 
of the Acts by said section directed, shall be guilty of a mis- 
demeanor; and on conviction thereof, shall be sentenced to pay 
a fine of not exceeding one thousand dollars, and undergo 
punishment not less than ten days nor exceeding one year. Sec. 
7, Id. 

Disposing of Oil without Owner's Consent. 

Any corporation, association, company, or officer or agent 
thereof, or person or persons, who shall sell, incumber, transfer 
or remove, or cause or procure to be sold, transferred or re- 
moved, from the tanks or pipes of such corporation, company, 
association, person or persons, any petroleum, crude or refined, 
without the written consent of the owner or owners thereof, shall 
be guilty of a misdemeanor; and upon conviction thereof, shall 
be sentenced to pay a fine of one thousand dollars, and undergo 
an imprisonment not less than ninety days and not exceeding two 
years. Sec. 8, Id. 



(STATE STATUTES lOo 

Failure to Report Monthly. 

Any corporation, association, company, person or persons, en- 
gaged in the business of transporting' by pipe lines, or storing 
petroleum, eriide or refined, and each and every officer or agent 
of such association, corporation, company, person or persons, 
who shall neglect or refuse to make the report and statement 
required by the fifth section of this Act, within the- time and in 
the manner directed by said section, shall forfeit and pay the 
sum of one thousand dollars and in addition thereto the sum 
of five hundred dollars for each day after the tenth day of the 
month that the report or statement required by said section 5 
shall remain unposted as therein directed. Sec. 9, Id. 

Oil Vouchers Negotiable. 

Accepted orders and certificates for petroleum, issued by any 
corporation or partnership association engaged in the business 
of transporting and storing petroleum in this State, shall be 
negotiable, and may be transferred by endorsement either in 
blank or to the order of another; and any person to whom the 
said accepted orders and certificates shall be so transferred, shall 
be deemed and taken to be the owner of petroleum therein spec- 
ified. Sec. 1, Act June 20, 1883, p. 127. 

Must Allow Inspection with Use of Tools. 

Every firm, association or corporation within this common- 
wealth, or engaged in the business of storing or transporting 
crude or refined petroleum by means of pipe lines, shall, on 
or before the first day of July, next ensuing, and every firm, 
association or corporation that may hereafter engage in said 
business, shall, before engaging therein, file in the office of 
the Secretary of the commonwealth a writing authorizing any 
person or persons wmo may be appointed to inquire into the 
condition of such firm, corporation or association, under exist- 
ing law or this Act, or any law that may be hereafter enacted, 
to enter upon and have free access to the premises of such firm, 
association or corporation, whether the same may be in this 
or some other State, or partly in this and partly in some other 
M. O. R.— 48. 



754 MORRISON'S OIL RIGHTS 

State or States, for the purpose of inspecting and gauging the 
petroleum, crude or refined, that may be in the custody of said 
firm, association or corporation, and of examining the books, 
accounts and papers thereof, relative to oil in its custody, and 
liability therefor, including oil owned by said firm, association 
or corporation. And the said writing shall extend to and em- 
brace full permission to use the tools, implements and appliances 
of said firm, association or corporation, for the purposes of mak- 
ing such inspection and gauge, and shall grant full and absolute 
authority for the business hereof, and shall remain good and 
valid so long as such firm, association or corporation continue 
to do business in this State. Sec. 1, Act of July 5, 1883, p. 186. 

Forfeiture of Charter and Denial of Judicial Protection the 
Penalty. 

The person or persons who may be appointed under any law 
of this commonwealth, to make such examination, gauge and 
inspection, shall produce to the Secretary of the commonwealth 
a certificate, attested by satisfactory proof of his or their ap- 
pointment as such examiner or examiners, whereupon the Sec- 
retary of the commonwealth shall issue to such examiner or 
examiners, a certified copy of the writing aforesaid, "accom- 
panied by a certificate, countersigned by the governor, that the 
person or persons therein named have been duly appointed to 
make such examination, inspection and gauge as aforesaid, and 
to exercise, under the appointment of the commonwealth the au- 
thority delegated under the writing aforesaid, for a period there- 
in named, which shall not exceed thirty days ; and it shall be the 
duty of any such firm, association or corporation, upon the pro- 
duction of such certificate and certified copy aforesaid to any 
of its officers or agents, to give without delay, to such examiner 
or examiners free access to its offices, and such books, papers, 
accounts, as show the amount of oil in its custody, and for which 
it is liable, including oil owned by said firm, association or cor- 
poration, and its tanks, stations and other property, and to fur- 
nish information regarding the same. But if such firm, asso- 
ciation or corporation, its officers or agents, shall refuse or deny 
access to or entry upon the premises of such firm, association or 



s 



STATE STATUTES 755 

corporation, or Shall in anywise hinder, obstruct or prevent said 
examiner or examiners from making an examination, gauge and 
inspection of the books, papers, accounts aforesaid, and of the 
tanks and pipes of said firm, association or corporation, or shall 
wilfully withhold information regarding the same, or deny the 
use of its tools and appliances for the purpose of making such 
examination, inspection and gauge, such refusal, hindrance, de- 
nial or obstruction shall work a forfeiture of the charter of any 
such corporation chartered by this commonwealth, or of the 
right to do business in this commonwealth of any such firm or 
association or foreign corporation ; and in such case the right of 
such foreign corporation to bring suits in the Courts of this 
State shall cease. In all cases where the tanks, pipes, books, of- 
fices, accounts and petroleum to be examined and gauged are 
situated in this State; it shall only be necessary for the exam- 
iner or examiners to produce to such firm, association or cor- 
poration, or to any of its officers or agents, a certificate of the 
Court or other lawful authority, appointing him or them, show- 
ing him or them to be duly accredited and lawful examiner or 
examiners. Sec. 2, Id. 

Not More Than 25 Examiners to Be Appointed Per Diem. 

The owners of oil which is in the custody of any such firm, 
association or corporation, not less in the aggregate, than two 
percentum of the amount of oil in custody of such firm, asso- 
ciation or corporation, as shown by its last preceding monthly 
statement, may, at any time, but not oftener than once in three 
months, present their petition to the Court of common pleas of 
the county wherein such firrn, association or corporation may 
have its principal office, and of any foreign, corporation, to the 
Court of Common pleas in any county in which said corporation 
may be doing business, or to any law judge of said court in 
vacation, setting forth, under oath, their ownership, as aforesaid, 
and desire for the appointment of examiners for the purposes 
of this Act; whereupon the court, or any judge thereof in vaca- 
tion, shall forthwith appoint such number of impartial, disinter- 
ested and competent persons as may be necessary not exceeding 
twenty-five, as examiners, one of whom shall be designated as 



<5b MORRISON'S OIL RIGHTS 

chief, and the others shall be subordinates, and shall fix the 
amount of their compensation, which shall not exceed five dol- 
lars per day. Sec. 3, Id. 

Examiners to Gauge and Inspect. 

The Court or judge, by order, shall direct and empower such 
examiners under the supervision of their chief, to immediately 
inspect and measure all the petroleum, crude or refined, in the 
custody of any such firm, corporation or association, named in 
said petition, on the day or days of inspection, and to examine 
the books of such firm, association or corporation, relating to 
the issue and cancellation of receipts, certificates, accepted or- 
ders, vouchers, or evidences of liability, and to its own accounts 
with persons, companies or corporations with whom it deals in 
the receipt or delivery of crude or refined petroleum. Such exam- 
iners, when appointed, shall immediately be sworn, before any 
authorized officer, to perform his duties with fidelity and accord- 
ing to law; which oath shall be reduced to writing, signed and 
filed with the prothonotary ; and they shall then, under super- 
vision of the chief examiner, make immediate examination, 
gauge and inspection, as required by said petition and order, and 
by this Act. Sec. 4, Id. 

• 
Details of Examiner's Reports. 

Upon the completion of such inspection, examination and 
measurement, it shall be the duty of the examiner or exam- 
iners, or in the event of the death, resignation or declination, 
or inability to act of any of them, then the others or any of 
them, within thirty days after tHeir appointment, to make to 
the court appointing them a written, signed and sworn report 
of such examination, inspection and measurement, and file the 
same of record with the prothonotary thereof, which report shall 
show : 

I. How much merchantable, and also how much unmerchant- 
able petroleum, crude or refined, they found in the tanks and 
lilies of such firm, association or corporation, and where the 
same was located or held, by description of tanks, also the per- 



STATE STATUTES 757 

eeatage of merchantable oil mingled with the B. S. and sedi- 
ment. 

II. For the custody or delivery of how much crude or refined 
petroleum they found such firm, association or corporation to 
be liable at the same date. 

III. How much of such liability was represented by outstand- 
ing receipts, accepted orders, certificates, vouchers, or evidences 
of liability, and how much by credit balances. Sec. 5, Id. 

Penalty for False Reports. 

Any examiner appointed aforesaid, who shall make any false 
examination, inspection, measurement or report, or shall make 
known, directly or indirectly, to any person, any information he 
may become possessed of in the course of his examination, in- 
spection or measurement, except by means of his report, made 
and filed in accordance with this act, or who shall receive, di- 
rectly or indirectly, any fee, reward or benefit, or the promise of 
any fee, reward or benefit, other than that provided by this Act, 
for the performance or non-performance of any duty or thing 
contemplated by this Act, or connected with the said employ- 
ment, shall be guilty of a misdemeanor, and, upon conviction 
thereof, shall be sentenced to pay a fine of one thousand dollars, 
and to imprisonment not less than three months, or more than 
two years. Sec. 6, Id. 

Refusal of Access a Misdemeanor. 

Any officer, agent, manager, superintendent or employee of 
any firm, corporation or association as aforesaid, who shall ne- 
glect or refuse, after demand made, to give to any authorized 
examiner full and free access to any and all offices, pipes, tanks, 
accounts, books and vouchers as aforesaid, or deny to him the 
use of any tools or appliances as required by him in pursuance 
of his appointment and this Act, shall be guilty of a misdemean- 
or, aiid, upon conviction thereof, shall be sentenced to pay a fine 
not exceeding one thousand dollars, and to imprisonment not 
exceeding one year. Sec. 7, Id. 



758 MORRISON'S OIL RIGHTS 

Appropriation of Fines. 

All fines recovered from any person under this Act, and all 
penalties, shall be paid to the proper officer for the use of the 
comity wherein snch suit is brought or prosecution instituted. 
Sec. 8, Id. " 

Payment of Expenses. 

V 

The examiners shall also file with their report an itemized 
and sworn statement of the entire expenses incurred in making 
such examination, inspection and gauge, including their com- 
pensation, to be taxed as costs in other cases, and if allowed and 
approved by the Court, the same shall be paid by the firm, cor- 
poration or association named in the petition within twenty 
days, and upon failure to do so, judgment may be entered forth- 
with in favor of the persons performing the services, for the 
amount due them, and against said firm, corporation or associa- 
tion, upon which execution may at once issue. Sec. 9, Id. 

Proviso as to Appointment of Inspectors. 

Nothing contained in this Act shall be construed to interfere 
with any law authorizing the appointment of an inspector of 
oils. Sec. 10, Id. 

Pipe Line Companies 

Local Act Extended. 

The provisions of an Act relating to corporations for mechan- 
ical, manufacturing, mining and quarrying purposes, approved 
July 18, 1863, and the supplements thereto, be and the same 
are hereby extended to the transportation and storage of petrol- 
eum in the counties of Venango, Warren, Forest. Armstrong, 
Clarion, Butler, prawford and Erie; and that any company or- 
ganized for such purposes, under the provisions of said Act, 
shall have the right to ti'ansport, store, insure and ship petrol- 
eum, and for that purpose lay down, construct and maintain 
pipes, tubing, tanks, offices and such other machinery, devices or 



STATE STATUTES 759 

arrangements as may be necessary, and to enter upon, use and 
Occupy such lands as may be requisite for the purposes of the 
company and for rights of entry upon lands, rights of way and 
the use of material necessary to the construction, maintenance 
and operation of said lines of pipes and fixtures as aforesaid, they 
shall be entitled to all the rights and privileges, and be subject to 
all the limitations and restrictions of railroad companies, as con- 
tained in the Act relating to railroad companies, approved 
February 19, 1849, and the supplements thereto: Provided, 
however, That nothing herein contained shall be construed to 
authorize the construction of any railroad. Sec. 1, Act 1872, 
p. 22. 

Change of Location of Pipes. Branches. Preferences Forbid- 
den. 

Any company organized under the provisions of this Act may 
at any time change the location of the whole or any part of 
their pipes, or construct a branch or branches from any point 
or points on the main line, to any other point or place within 
the counties aforesaid; but before doing so, a majority of the 
directors of said company shall make, or cause to be made, a 
certificate in writing, setting forth the proposed change, par- 
ticularly setting forth the routes and termini, and have the same 
acknowledged before a notary public, and recorded in the same 
manner as shall be provided in the original articles of the asso- 
ciation: Provided, That no line of pipe shall be laid, under the 
authority of this act, withm five miles of the State line for the 
purpose of carrying oil out of the State; and that the owners, 
producers and shippers of all oil intended for Philadelphia, 
Baltimore and New York, using pipe lines laid under this Act, 
shall give the preference to the lines of road traversing the great- 
est distance in this State, at the same rates for transportation. 
Sec. 2, hi. 

Act of 1874 Amended. Pipe Line Companies to Be Recorded. 

.[Companies may be incorporated for] the carrying on of any 
meehanical, mining, quarrying or manufacturing business, in- 



<tiU MORRISON'S OIL RIGHTS 

eluding all of the purposes covered by the provisions of the 
Act of the general assembly, entitled ."An Act to encourage 
manufacturing operations in this commonwealth," approved 
April 7, 1849, and entitled "An Act relating to corporations for 
mechanical, manufacturing, mining and quarrying purposes," 
approved July 18, 1863, and the several supplements to each of 
said Acts, including the incorporation of grain elevators, stor- 
age warehouse and storage yard companies; and also includ- 
ing the storage and transportation of water, with the right to 
take rivulets and land, and erect reservoirs for holding water 
and excluding the distilling or manufacture of intoxicating- liq- 
uors, and companies may be organized under this Act, having 
the right to transport, store, insure and ship petroleum, and for 
that purpose to lay down, construct and maintain pipes, tubing, 
tanks, offices, and such other machinery, devices or arrangements 
as may be necessary to fully carry out that right ; and also with 
the right to enter upon, take and occupy such land and other 
property as may be requisite for the purposes of such corpora- 
tions. (Sec. 1, Act June 2, 1883, p. 61.) 

Corporate Powers and Liabilities of Pipe Lines. 

All companies incorporated, or hereafter to be incorporated, 
under the provisions of the Act to which this is a supplement, 
for the purpose of the transportation and storage of oil, by 
means of pipe lines and tanks, for the public, shall have the 
powder to take, hold, purchase and transfer such real and per- 
sonal property as the purposes of the corporation may require, 
not exceeding the amount limited by the charter, together with 
the right to appropriate and take lands, easements and rights of 
way for locating and constructing steam pumps, tanks, pump 
houses and offices, and laying down its pipes or tubes, connec- 
tions and trenches from any point or points in any of the coun- 
ties in which petroleum is produced, to any railroad, canal, navi- 
gable river, port or city within this commonwealth, and for all 
necessary purposes of the corporation, including right to cross 
railroads, and the right to appropriate a right of way and locate 
its pipes and tubes upon and over, under and across any lands, 
waters, streams, rivulets, roads, turnpike roads, canal or other 



STATE STATUTES 761 

public highway, not, however, passing through any burying 
ground or place of public worship, or any warehouse, mill, manu- 
factory, store or dwelling-house without the consent of the own- 
er or owners thereof being first had and obtained: Provided, 
That when said pipe line is located through, over, under or 
upon the streets, lanes, alleys or highways within the corpo- 
rate limits of any city or borough, the consent of the munici- 
pal authorities to said location shall be first had and obtained; 
which consent said municipal authorities are hereby empowered 
to give upon terms to be agreed upon by said city or borough 
authorities and said corporation: And provided, further, In case 
said pipe lines cross any railroad or canal, the same shall be 
located under or above the same, so, however, as not to inter- 
fere with the use of the same : Provided, further, That corpora- 
tions organized under this Act and its supplements, shall not 
take a fee in any lands acquired under any of its provisions, 
except such as are acquired by actual purchase, and that upon 
the abandonment for the purposes of transporting oil, any lands 
taken by any company organized under the act to which this 
is a supplement and its supplements, said lands so taken, other- 
wise than by actual purchase, shall revert to the original own- 
ers or their successors: And 'provided, further, That any pipe 
line, so laying its pipes under the provisions of this Act, in 
occupying any lands cleared and used for agricultural pur- 
poses, shall bury the same at least 24 inches below the surface, 
and if any line of pipe shall be laid over or through any waste or 
woodland, which shall afterwards be changed from waste or 
woodland to farming land, then it shall be the duty of the pipe 
line company to immediately bury the pipe, to the depth of at 
least 24 inches as aforesaid; Provided, That all pipe lines shall 
be laid above the flood lines or beneath the bed, in crossing 
creeks or rivulets: And provided, further, That any company 
laying a pipe line under the provisions of this Act shall be liable 
for all damages occasioned by leakage, breaking of pipes or 
tanks: Provided, further, That all tanks erected for the storage 
or transportation of oil, shall be protected and surrounded by 
ditches and embankments, so that, ir. case said tanks should 



i62 MORRISON'S OIL RIGHTS 

break or be broken, the oil stored cannot damage adjoining prop- 
erty. Sec. 2, Id. 

Procedure to Condemn Right of Way. 

In all cases when under the provisions of this Act, said cor- 
poration is permitted to take lands or property for the public 
purposes of said corporation, or to acquire right of way ease- 
ment, for the purpose of locating its pipes or branches over, 
upon, under or across any lands, streams, rivulets, roads, turn- 
pike roads, railroads, canals or other highways and the said cor- 
poration cannot agree with the owner or owners of any such 
lands, road, turnpike road, railroad, canal or other highway or 
franchise, for the compensation proper for the damage done, 
or likely to be done to or sustained by any such owner or owners 
of said waters, streams, land, road, turnpike road, railroad, land 
or other highways, which such corporation may enter upon, use 
in pursuance of the authority herein given, or by reason of the 
absence or legal incapacity of any such owner or owners, no such 
compensation can be agreed upon, the Court of common pleas 
of the proper county, on application thereto by petition, either 
by said corporation, or the owner or owners, or any one in be- 
half of either, shall appoint seven discreet and disinterested free- 
holders, residents of the proper county, and appoint a time, not 
less than twenty days, nor more than thirty days thereafter, for 
said viewers to meet at or upon the premises, where the dam- 
ages are alleged to be sustained, or the property taken, of which 
time and place ten days' notice shall be given by the petitioner 
to the said viewers and the other party; and "the said viewers, 
or any five of them, having been first duly sworn or affirmed, 
faithfully, justly and impartially to decide and a true report to 
make concerning all matters and things to be submitted to them 
and in relation to which they are authorized to inquire in pur- 
suance of the provisions of this Act, and having viewed the 
premises, they shall estimate and determine the quantity, qual- 
ity and value of said lands, streams, property, easement, fran- 
chise or rights of way so taken, and shall award to the owner or 
owners thereof just compensation for the property taken, in- 
jured or destroyed by the construction or enlargement of such 



STATE STATUTES 7 Go 

pipe lines, works and improvements; which compensation shall 
be paid or secured as hereinafter provided, before such taking, 
injury or destruction: Provided, That for any subsequent in- 
jury, taking or destruction of property, the owner or owners of 
the property taken, injured or destroyed, shall have the right 
to recover full compensation for such taking injury or destruc- 
tion, and an action for any subsequent injury or taking- or de- 
struction of property, may be brought within the county in 
which the damages are sustained and the summons may be 
directed to the sheriff of the county in which the corporation 
defendant may have its principal place of business, and service 
may be made upon the president, secretary or other officer in 
charge of said principal office, to have the same effect as if 
the said corporation defendant was resident within the 
proper county, and make report thereof to the said court ; 
and if any damages be awarded, and the report be confirmed 
by the said Court, judgment shall be entered thereon; and 
if the amount thereof be not paid within thirty days after 
the entry of such judgment, execution may then issue thereon, 
as in other cases of debt, for the sum so awarded. And the costs 
and expenses incurred shall be defrayed by the corporation ; and 
each of said viewers shall be entitled to two dollars and fifty 
cents per day, for each day necessarily employed in the per- 
formance of the duties herein prescribed, to be paid by such 
corporation. In all cases when the parties cannot agree upon 
the amount of damages claimed, or by reason of the absence or 
legal incapacity of such owner or owners, no such agreement 
can be made, either for lands, streams, waters, water rights, 
franchises, rights of way, the corporation shall tender a bond, 
witli at least two sufficient sureties, to the parties claiming or 
entitled to any damages, or to the attorney or agent of any per- 
son absent, or to the guardian or committee of any one under 
legal incapacity, the condition of which shall be, that the said 
corporation will pay such amount of damages as the party shall 
he entitled to receive, after the same shall have been agreed upon 
by the parties, or assessed in the manner provided for by this 
Act: Provided, That in case the party or parties claiming dam- 
ages refuse, or do not accept the bond tendered, the said corpora- 



7 (3 ± MORRISON'S OIL RIGHTS 

tion shall then give the party a written notice of the time when 
the same will be presented for filing in court, and thereafter 
the said corporation may present said bonds to the court of com- 
mon pleas of the county where the lands, streams, waters, rivu- 
lets, roads, railroads, turnpike roads, canals or other highways 
are ; and if the sureties and the amount of the bond be approved, 
the bond shall be filed in said Court, for the benefit of those in- 
terested, and recovery may be had thereupon for the amount 
of damages assessed, if the same be not paid or cannot be made 
by execution on the judgment in the issue formed to try the 
question. The viewers provided for in this section may be ap- 
pointed before or after the entry for constructing said work; 
and after the filing of the bond herein before provided for, and 
upon the report of the said viewers, or any three of them being 
filed in said Court, either party, within thirty days thereafter 
may file his, her or their appeal from said report to said Court. 
After such appeal, either party may put the cause at issue in the 
form directed by said Court, and the same shall be tried by said 
Court and a jury, and after final judgment, either party may 
f, ave a writ of error thereto from the Supreme Court, in the man- 
v prescribed in other cases ; the said court shall have power to 
order what notices shall be given of the proceedings, and may 
make all such orders connected with the same, as may be deemed 
requisite ; if any exceptions be filed, with any appeals, to the pro- 
ceeding, the same shall be speedily disposed of, and if allowed, a 
new view shall be ordered; and if disallowed, the appeal shall 
proceed as before provided: Provided, further, That when the 
term "owner" is used in the foregoing section to this Act, or in 
this Act in reference to an effort to agree with, or to the tender of 
a bond to, or service of notice upon the owner of roads, railroads, 
turnpike roads, canals or other highways, the same shall be taken 
to mean the officers in charge of said road, railroad, turnpike 
road, canal or other public highways, on whom service of process 
could be made in any action at law or in equity: Provided, That 
all companies organized under this Act, shall have their terminus 
in Pennsylvania. Sec. 3, Id. 



sVAte statutes 76r> 

Duty to Furnish Gas to Consumers. 

The transportation and supply of natural gas for public con- 
sumption is hereby declared to be a public use, and it shall be 
the duty of corporations, organized or provided for under this 
Act, to furnish to consumers along their lines and within their 
respective districts natural gas for heat or light or other pur- 
poses as the corporation may determine. Act 1897, p. 51; Pur- 
don, p. 3223. 

Abandoned Wells to Be Filled and Plugged. 

Whenever any well shall have been put down on lands of any 
company authorized by this Act for the purpose of exploring 
for, or producing gas, upon abandoning or ceasing to operate 
the same the company shall, before drawing the casing, fill up 
the well with sand or rock sediment to the depth of at least 
twenty feet above the gas-bearing rock, and drive a round, seas- 
oned, wooden plug, at least two feet in length, equal in diameter 
to the diameter of the well below the casing, to a point at least 
five feet below the bottom of the casing, and immediately after 
the drawing of the casing shall drive a round, wooden plug into 
the well at the point just below where the lower end of the 
casing shall have rested, which plug shall be at least three feet 
in length, tapering in form, and to be of the same diameter at 
the distance of eighteen inches from the smaller end of the di- 
ameter of the well below the point at which it is to be driven. 
After the plug has been properly driven there shall be filled in 
on top of the same sand or rock sediment to the depth of at 
teas* five feet, Sec. 20, Act 1885, p. 36; Purdon, p. 3227. 

Penalty. 

Any company which shall violate the proceedings of the pre- 
ceding section shall be liable to a penalty of two hundred dollars. 
to be recovered as debts of like amount are by law recoverable. 
Sec. 21, Act 1885, p. 36; Purdon, p. 3227. 



766 MORRISON'S OIL RIGHTS 

Ad joiners May Plug Wells. 

Whenever any company shall neglect or refuse to comply with 
the provisions of this Act with regard to plugging wells, any 
owner of lands adjacent, or in the neighborhood of such un- 
plugged well, may enter and take possession of said abandoned 
well and plug the same, as provided by this Act, at the expense 
of the company whose duty it may have been to plug the same. 
Sec. 22, Act 1885, p. 36; Purdon, p. 3227. 

Natural Gas Companies May Deal in Fuel Gas. 

Section 1. Be it enacted, etc., that corporations engaged in 
supplying natural gas under the provisions of an act of 
assembly, approved the 29th day of May, 1885, entitled "An 
Act to provide for the incorporation and regulation of natural 
gas companies," shall also have power to manufacture or pur- 
chase and to transport and supply manufactured fuel gas to the 
public, through their transportation and distribution lines to 
and into every district in which they are authorized to do busi- 
ness; Provided however, that such manufactured fuel gas shall 
not be supplied in any district not theretofore supplied with 
natural gas, where an existing corporation has the right to sup- 
ply and is supplying in any such district, manufactured gas 
for light, heat or fuel purposes, or any of them, except with the 
consent of such corporation. Act 1917, p. 102. 

The above sections 20, 21, 22 of the 1885 Act seem to cover 
only the plugging of wells sunk by corporations. The above 
Act of 1917 is a supplement to the same sections, and they make a 
useless distinction arising from their being found in one of 
the corporation Laws. 

By Act of April 23, 1907, Purdon, 13th Ed. p. 7029, County 
Commissioners are authorized to sink gas wells for municipal 
supply. 

TENNESSEE. 

Casing Wells to Protect against Water. 

Be it enacted by the 'General Assembly of the State of Tenn- 



STATE STATUTES 70. 

essee, That when any well shall be drilled for the production of 
petroleum oil, natural gas, salt water or mineral water, it shall 
be the duty of the owner thereof, before drilling said well into 
the oil and gas sand, to encase sueh well with good and sufficient 
wrought iron, steel, or metal casing in such manner as to exclude 
and shut out all surface water, salt water, or fresh water", and 
to prevent the same from reaching or penetrating said oil and 
gas sand. Sec. 1, Act, 1905, p. 789. 

Abandoned Wells, How to Be Closed. 

Be it further enacted, That it shall be the duty of any owner 
of any well drilled for any of the purposes mentioned in the first 
section of this Act, before abandoning or ceasing to operate the 
same and before drawing the casing therefrom, to fill up the 
well with sand or rock sediment to a depth of at least fifty feet 
above the top of the oil or gas-bearing sand or rock, and drive a 
round, seasoned wooden plug at least three feet in length, equal 
in diameter to the diameter of the well below the casing, to a 
point at least five feet below the bottom of the casing; and im- 
mediately after drawing the casing, except in regions where the 
well caves after the withdrawal of the casing shall drive a round, 
seasoned plug at a point just below where the lower end of the 
easing rested; which plug shall be at least three feet in length, 
tapering in form, and of the same diameter at the distance of 
below the point at which it is to be driven. After the plug has 
been properly driven, there shall be filled in on top of the same, 
eighteen inches from the smaller end as the diameter of the hole 
sand or rock sediment to the depth of at least fift} r feet above 
the top of the oil or gas-bearing sand or rock. Sec. 2, Id. 

Danger of Waste of Gas to Be Prevented. 

Be it further enacted, That it shall be the duty of any owner 
of any well producing gas, to prevent the waste of said gas by 
escape and within the time hereinafter limited, to shut in and 
confine the same in said well, or in the pipe or pipe lines con- 
nected therewith. Said gas, with respect to any well hereto- 
fore drilled, shall be so shut in within ninety days after the 



768 -MORRISON'S OIL RIGHTS 

approval of this Act, and with respect to any well hereafter 
drilled or completed, shall be shut in within ninety days after 
the said well shall reach the lowest oil and gas sand defined or 
recognized in the gas or oil district in which said well is situated ; 
but if any such well in the course of drilling shall pass through 
any oil and gas sand which produces gas above the said last or 
lowest oil and gas sand, then the drilling of said well to the 
last or lowest oil and gas sand shall be prosecuted with reason- 
able diligence, so that any waste of gas from the said upper sand 
shall not continue longer than shall be reasonably necessary. 
Provided, however, that this section of this Act shall not apply 
to any well producing both oil and gas from the same sand, or 
to any well while it is being operated as an oil well, or to any 
well drilled more than five years before the passage of this Act. 
Sec. 3, Id. 

Adjoining Owners May Plug Wells. 

Be it further enacted, That if the owner of any such well shall 
neglect or refuse to cause said well to be plugged or shut in pur- 
suant to the provisions of the second and third sections of this 
Act for a period of thirty days after a written notice so to do 
(which notice may be served personally upon such owner, or 
may be posted in a conspicuous place at or near the well), it 
shall be lawful for the owner or operator of any adjacent or 
neighboring lands to enter upon the premises where said well is 
situated and cause the same to be plugged, if it be an abandoned 
well, or shut in if not abandoned, pursuant to the provisions 
hereof; and the reasonable cost and expense incurred in so do- 
ing shall be paid by the owner of said well and may be recovered 
as debts of like amount are by law recoverable. Sec. 4, Id. 

"Owner" and Other Terms Defined. 

Be it further enacted, That the term "owner," as herein used 
with reference to any well, shall mean and include each and 
every person, persons, copartnership, partnership, association 
or corporation owning, managing, operating, controling. or pos- 
sessing said well as principal or principals; and the terms "oil 



STxVfE STATUTES 769 

and gas sand" or "sand" as herein used, shall mean and include 
any bed, seam, or stratum of rock, sand, or other material which 
produces, yields, or contains in quantity sufficient to be utilized, 
petroleum oil and natural gas, or either of them. Sec. 5, Id. 

Penalty. 

Be it further enacted, That any person or persons, co-part- 
nership, partnership, association, or corporation violating any of 
the provisions of this Act shall be liable to a penalty of one hun- 
dred dollars, to be recovered with costs of suit in any civil ac- 
tion to be brought in the name of the State of Tennessee, in any 
Circuit Court, and such action may be brought at the instance; 
and upon the relation of any citizen of the State. Sec. 6, Id. 

Relief in Equity against Waste. 

Be it further enacted, That aside from and in addition to 
the imposition of any penalties under this Act, it shall be the 
duty of any Chancery Court in the exercise of its equitable juris 
diction, to hear or determine any bill or bills in equity which 
may be filed to restrain the waste of natural gas in violation of 
this Act, and to grant relief by injunction or by other decrees 
or orders, in accordance with the principles and practice in 
equity. The complainant in such bill shall have sufficient stand- 
ing to maintain the same if he shall aver and prove that he is 
interested in the lands situated within the distance of one mile 
from said well, either as an owner of such land in fee simple, or 
as an owner of leases thereof, or of rights therein for the pro- 
duction of oil and gas or either of them. Sec. 7, Id. 

WEST VIRGINIA. 

Casing against Water. 

That when any well shall be drilled for the production of 
petroleum oil, natural gas, salt water or mineral water, it shall 
be the duty of the owner thereof, before drilling said well into 
the oil and gas sand, to encase such well with good and sufficient 
wrought iron, steel or metal casing in such manner as to exclude 
M. O. R.— 49. 



770 MORRISON'S OIL RIGHTS 

and shut out all surface water, salt water or fresh water, and to 
prevent the same from reaching or penetrating said oil and gas 
sand. Sec. 1, Act 1891, ch. 106, 1897, ch. 58. 

Plugging and Casing Abandoned Wells. 

It shall be the duty of the owner of any well drilled for any 
of the purposes mentioned in the first section of this Act, before 
abandoning or ceasing to operate the same and before drawing 
the casing therefrom, to fill up the well with sand or, .rock sedi- 
ment to a depth of at least fifty feet above the top of the oil or 
^as-bearing sand or rock, and drive a round, seasoned wooden 
plug, at least three feet in length, equal in diameter to the di- 
ameter of the well below the casing, to a point at least five feet 
below the bottom of the casing, and immediately after draw- 
ing the casing, except in regions where the well caves after 
the withdrawal of the casing, shall drive a round, seasoned wood- 
en plug at a point just below where the lower end of the casing 
rested; which plug shall be at least three feet in length, taper- 
ing in form and of the same diameter at the distance of 18 inches 
from the smaller end, as the diameter of the hole below the point 
at which it is to be driven. After the plug has been properly 
driven there shall be filled in on the top of the same, sand or roek 
sediment to the depth of at least fifty feet above the top of the 
oil or gas-bearing sand or rock. Sec. 2., Id. 

Prevention of Waste of Gas. Several Strata. 

It shall be the duty of any owner of any well producing gas. 
to prevent the waste of said gas by escape, and within the time 
hereinafter limited, to shut in and confine the same in said 
well or in the pipes or pipe lines connected therewith. Said gas 
with respect to any well heretofore drilled shall be so shut in 
within ninety days after the approval of this Act, and with 
respect to any well hereafter drilled or completed, shall be slmt 
in within ninety days after the said well shall reach the lowest 
oil and gas sand defined or recognized in the gas or oil district 
in which said well is situated ; but if any such well in the course 
of drilling* shall pass through any oil and gas sand which pro- 



STATE STATUTES 77.1 

duces gas above the said last or lowest oil and gas sand, then the 
drilling' of said well to the last or lowest oil and gas sand shall 
be prosecuted with reasonable diligence, so that any waste of 
gas from the said upper sand shall not continue longer than 
shall be reasonably necessary: Provided, however, That this 
section of this Act shall not apply to any well producing both 
oil and gas from the same sand, or to any well while it is being 
operated as an oil well. Sec. 3. Id. 

When Adjacent Owner or Operator May Plug. 

If the owner of any such well shall neglect or refuse to cause 
said well to be plugged or shut in pursuant to the provisions of 
the second and third sections of this Act for a period of twenty 
days after a written notice so to do (which notice may be served 
personally upon such owner, or may be posted in a conspicu- 
ous place at or near the well), it shall be lawful for the owner or 
operator of any adjacent or neighboring lands to enter upon 
the premises, where said well is situated and to cause the same 
to be plugged if it be an abandoned well, or shut in if not 
abandoned, pursuant to the provisions hereof; and the reason- 
able cost and expense incurred in so doing shall be paid by the 
owner of said well, and may be recovered as debts of like amount 
are by law recoverable. Sec. 4 Id. 

Owner and Sand Defined. 

The term "owner," as herein used, with reference to any 
well, shall mean and include each and every person, persons, 
copartnership, partnership, association or corporation owning, 
managing, operating, controlling or possessing said well as prin- 
cipal or principals, or as lessees, contractors, employees, or agents 
of such principal or principals; and the terms "oil and gas 
sand," or "sand," as herein used, shall mean and include any bed, 
seam, or stratum of rock, sand or other material which produces, 
yields, or contains in quantity sufficient to be utilized, petroleum 
oil and natural gas or either of them. Sec. 5. Id. 



i i'l MORRISON'S OIL RIGHTS 

$100 Penalty. 

Any person or persons, copartnership, partnership, associa- 
tion or corporation violating: any of the provisions of this Act 
shall be liable to a penalty of one hundred dollars, to be recov- 
ered with costs of suit in a civil action to be brought in the name 
of the State of West Virginia, in any circuit court, and such 
action may be brought at the instance and upon the relation of 
any citizen of the State. Sec. 6. Id. 

Equity May Enjoin Waste. 

Aside from and in addition to the imposition of any penal- 
ties under this Act, it shall be the duty of any circuit court in 
the exercise of its equitable jurisdiction, to hear and determine 
any bill or bills in equity which may be filed to restrain the 
waste of natural gas in violation of this Act, and to grant relief 
by injunction or by other decrees or orders, in accordance with 
the principles and practice in equity. The plaintiff in such bill 
shall have sufficient standing to maintain the same if he shall 
aver and prove that he is interested in the lands situated with 
in the distance of one mile from said well, either as owner of 
such land in fee simple, or as an owner of leases thereof or of 
rights therein for the production of oil and gas, or either of 
them. Sec. 7. Id. 

Limitation to Protect Oil Lessee. 

That any* person or persons, in peaceable possession of land, 
claiming title under a lease of the same for the purpose of oper 
ating for oil or minerals, and who may have continuously re- 
mained in such possession for the space of three years, and have 
bored for, and in good faith expended money in such boring and 
operating, shall be entitled to plead such facts in bar, and said 
facts shall be a bar to any action at law or in equity, instituted 
to establish title to recover possession of said lease, or to recover 
the profits received therefrom: Provided, That nothing in this 
Act contained shall be so construed as to authorize a tenant to 
set up as a bar to a recovery an adversary possession against his 
landlord, and that this Act shall not affect any suit brought with- 



STATE STATUTES 773 

in twelve months after the passage of this Act. Code 1906, § 
3498. 

Pipe Line Companies May Condemn. Common Carriers. 

That a company organized for the purpose of transporting 
natural gas, petroleum or water, necessary for use in carrying- 
out the provisions of this Act in piping and transporting natural 
gas and petroleum or for boring for the same, through tubing 
and pipes, may enter upon any land for the purpose of exam- 
ining and surveying a line for its tubing and pipes, and may 
appropriate so much thereof as may be deemed necessary for 
the laying down of such tubing and piping, and for the erec- 
tion of tanks and the location of stations along such line, and 
the erection of such buildings as may be necessary for the pur- 
pose aforesaid ; such appropriations shall be made and conducted 
in accordance with the law providing for compensation to the 
owners of private property taken for public use: Provided, 
That no dwelling-house, yard or garden, shall be taken for such 
purpose, nor shall any oil tank, gas or oil pipe line be erected 
oi* laid within 100 feet of any occupied dwelling-house without 
Hie consent of the owner thereof. And so far as the rights of 
the public therein are concerned, the county commissioners, as 
to public roads, and the council of any municipal corporation, 
as to streets and alleys, in their respective jurisdiction may, sub- 
ject to such regulations and restrictions as they may prescribe, 
grant to such company the right to lay such tubing and piping 
therein : Provided, however, The right to appropriate for any 
of the purposes herein above specified shall not include or 
extend to the erection of any tank, station or building, 
or lands thereof, or to more than one continuous line of pipe 
or tubing, or land therefor, in or through a municipal corpora- 
tion without the council first consents thereto; and all excava- 
tions shall be well filled by such company and so kept by it, in 
all cases. Such company shall, for the purpose of transporting 
natural gas, oils and water, be considered and held to be a com- 
mon carrier, and subject to all the duties and liabilities of such 
carrier under the laws of this State. Act 1891, ch. 113, ("ode 
1906. sec. 2229. 



i i± MORRISON'S OIL RIGHTS 

Act Regulating Transportation of Oil 

Pipe Lines and Storage Companies Subject to This Act. 

1. Every person, corporation or company now engaged, or 
who shall hereafter engage or continue in the business of trans- 
porting or storing petroleum, by ' means of pipe line or lines 
or storage by tanks, shall be subject to the provisions of this 
Act and shall conduct such business in conformity herewith ; 
and the word "comp'a ny" whenever used in this Act shall be 
construed to include persons and corporations. Act 1879, ch. 
27 ; Act 1891, ch. 44. Code, sec. 2829. 

Compelled to Make Connections and Accept Deliveries. 

2. Any company heretofore or hereafter organized for the 
purpose of transporting petroleum or other oils or liquids by 
means of pipe line or lines, shall be required to accept all petro- 
leum offered to it in merchantable order in quantities of not less 
than two thousand gallons at the wells where the same is pro- 
duced, making at its own expense all necessary connections with 
the tanks or receptables containing such petroleum, and to trans- 
port and deliver the same at any delivery station, within or 
without the State, on the route of its line of pipes which may be 
designated by the owners of the petroleum so offered. ' Id. § 
2830. 

Oil to Be Inspected, Graded and Measured. 

3. All petroleum of a gravity of thirty-five degrees Baume 
or under, at a temperature of sixty degrees Fahrenheit, offered 
for transportation by means of pipe line or lines, shall, before 
the same is transported, as provided by section 2 of this Act, 
be inspected, graded and measured at the expense of the pipe 
line company, and the company accepting the same for trans- 
portation shall give to the owner thereof a receipt stating there- 
in the number of barrels or gallons so received, and the grade, 
gravity and measurement thereof, and within a reasonable time 
thereafter, upon demand of said owner or his assigns, shall de- 
liver to him at the point of delivery a like quantity, and grade 



STATE STATUTES 77 O 

or gravity of petroleum in merchantable condition as specified 
in said receipt ; except that the company may deduct for waste 
one per centum of the amount of petroleum specified in such 
receipt. Id. § 2831. 

Rates Allowed for Transportation. 

4. The charge for receiving-, transporting and delivering pe- 
troleum of the gravity of thirty-five degrees Baume or under, 
at a temperature of sixty degrees Fahrenheit, by means of pipe 
line or lines shall not exceed one cent per barrel of forty-two 
gallons per mile ; Provided, That if said rate should amount for 
the whole distance transported to less than ten cents per barrel, 
then the sum of ten cents per barrel may be charged ; and, pro- 
vided, that if the distance be over twenty miles and not more 
than thirty miles, one-half cent per barrel may be charged for 
every mile over twenty miles; and provided, further, that if the 
distance be over thirty miles, the maximum charge shall not 
exceed twenty-five cents. Id. § 2832. 

Storage and Demurrage, Allowance for Evaporation. 

5. Any company engaged in storing petroleum of a gravity 
of thirty-five degrees Baume or under, at a temperature of sixty 
decrees Fahrenheit, by means of tanks, shall be permitted to 
charge for storage one cent per barrel per month or part of a 
month, unless the same is removed within fifteen days from the 
date when said' oil is received into the custody of such company, 
and shall be allowed for evaporation and waste one-half of one 
per centum of the oil per month unless removed within thirty 
days from the date of the receipt of such petroleum ; but no com- 
pany engaged in the business of storing petroleum of the grav- 
ity of thirty-five degrees Baume or under, at a temperature of 
sixty degrees Fahrenheit, shall charge for storage any amount 
in excess of that authorized by this section. Id. § 2833. 

Inspection and Measurement Before Carriage. Allowance for 
Waste. Loss from Overflow. 

6. All petroleum of a gravity exceeding thirty-five degrees 



776 .MORRISON'S OIL RIGHTS 

Baume at a temperature of sixty degrees Fahrenheit, offered for 
transportation by means of pipe line or lines, shall be inspected 
and measured at the expense of the company transporting the 
same, before the same is transported; and the company accept- 
ing the same for transportation, shall give to the owner thereof, 
or to the person in charge of the well or wells from which such 
petroleum has been produced and run, a ticket signed by its 
gauger, stating the number of feet and inches of petroleum 
which were in the tank or receptable containing the same be- 
fore the company began to run the contents of said tank, and 
the number of feet and inches of petroleum which remained in 
the tank after said run was completed ; and all deductions made 
for water, sediment or the like, shall be made at the time such 
petroleum is measured; and within reasonable time thereafter 
said company shall, upon demand, deliver from the petroleum 
in its custody to the owner thereof, or to his assignee, at such 
delivery station on the route of its line of pipes as he may elect, 
a quantity of merchantable petroleum, equal to the quantity of 
petroleum run from said tank, or receptacle, which shall be as- 
certained by computation; except that the said company trans- 
porting said petroleum may deduct for evaporation and waste 
two per centum of the amount of petroleum so run, as shown by 
said run ticket ; and except that in case of loss of any petroleum 
while in the custody of said company caused by fire, lightning, 
storm or other like unavoidable cause, such loss shall be borne pro 
rata by all the owners of such petroleum at tlie time thereof. 
But said company shall be liable for all petroleum that is lost 
while in its custody by the bursting of pipes or tanks or by 
leakage from pipes or tanks; and it shall also be liable for all 
petroleum lost from tanks at the wells where produced before 
the same has been received for transportation, if such loss be due 
to faulty connections made to said tanks; and said company shall 
be liable for all petroleum lost by the overflow of any tanks with 
which pipe line connections have been made, if such overflow 
he due to the negligence of such company; and for all the pe- 
troleum lost by the overflow of any tanks with which pipe line 
connections should have been made under the provisions of this 



S^ATB STATUTES 777 

Act. but were not so made by reason of negligence or delay 
on the part of said company. Id. § 2834. 

Statutory Charges Fixed. 

7. Any company engaged in transporting petroleum of a 
gravity exceeding thirty-five degrees Baume at a temperature 
of sixty degrees- Fahrenheit, by means of pipe line or lines, 
may charge for receiving, transporting and delivering such pe- 
troleum not to exceed twenty cents per barrel for each barrel 
of forty-two gallons: Provided, however, if where the point of 
delivery is without this State, more than twenty cents per barrel 
be charged, then there shall be charged no greater sum than ten 
cents per barrel for receiving such oil and transporting the same 
that part of the distance which is within this State. Act 1891, 
ch. 44 ; Code § 2835. 

Idem. When Demurrage Begins. 2 Per Cent Limit to De- 
ductions. 

8. Any company engaged in transporting or storing petrol- 
eum of a gravity exceeding thirty-five degrees Baume at a tem- 
perature of sixty degrees Fahrenheit, by means of pipe line or 
lines and tanks, shall make no charge for storing said petroleum 
until after the expiration of the month following that in which 
the oil was run and received into custody. But it may charge for 
storing said petroleum of a gravity exceeding thirty-five degrees 
Baume at a temperature of sixty degrees Fahrenheit, for every 
day after the expiration of the month following that in which 
said oil shall have been ran and received into custody, not to 
exeeed one-fortieth of one cent per barrel of forty-two gallons 
for each day thereafter sail oil shall continue to remain in its 
custody. Any such company shall make no charge for water, 
sediment, waste and the like in transporting or storing any pe- 
troleum after the same has been gauged or measured, before the 
ran of same is made, except the two per centum for waste and 
evaporation hereinbefore mentioned. Id. § 2836. 



778 MORRISON'S OIL RIGHTS 

Discrimination and Rebates Disallowed. 

9. No company engaged in transporting or storing petroleum 
by means of pipe line or lines and tanks shall charge, demand 
or receive from any corporation, company, association, person 
or persons a greater or less rate for the transportation or stor- 
age of petroleum that it charges, receives or demands from any" 
other corporation, company, association, person or persons for the 
transportation or storage of petroleum of like gravity; and any 
shift, device or subterfuge made or attempted for the purpose 
of avoiding the provisions of this section shall be void. Act. 
1879, chap. 27 ; 1891 ch. 44, § 2837. 

Fine and Damages for Overcharges. 

10. Any company, its officers or agents, willfully violating 
any of the provisions of sections two, three, four, five, six, seven, 
eight or nine, of this Act, or charging for any of the services 
provided for in any of said sections, an amount in excess of 
that authorized by said sections, shall be guiltj r of a misdemean- 
or, and on conviction thereof shall be fined not less than one 
hundred dollars, nor more than one thousand dollars, and shall 
moreover be liable to the party aggrieved for all damages sus- 
tained by him by reason of such excessive charges. Act, 1891, 
ch. 44, § 2838. 

Lien for Carriage and Storage. 

11. Any company engaged in transporting or storing petro- 
leum, shall have a lien upon said petroleum until all charges for 
transporting and storing said petroleum are paid. Act 1879, 
ch. 27 ; 1891 ch. 44, § 2839. 

Pipe Line Receipt Negotiable. 

12. Accepted orders and certificates for petroleum, issued 
by any company engaged in the business of transporting and 
storing petroleum in this State, by means of pipe line or lines 
and tanks, shall be negotiable, and may be transferred by en- 
dorsement, either in blank or to the order of another, and any 



STATE STATUTES 779 

person to whom the said accepted orders and certificates shall 
be so transferred, shall be deemed and taken to be the owner 
of the petroleum therein specified. Id. § 2840. 

Delivery of Oil Not to Be Anticipated. Precautions against 
Duplicate. Cancellations. 

13. No receipt, certificate, accepted order or other voucher, 
shall be issued or put in circulation, nor shall any order be 
accepted or liability incurred for the delivery of any petro- 
leum, crude or refined, unless the amount of such petroleum 
represented in or by such receipt, certificate, accepted order, or 
other voucher or liability, shall have been actually received by 
and shall then be in the tanks and lines, custody and control of, 
the company issuing or putting in circulation such receipt, cer- 
tificate, accepted order or voucher, or written evidence of lia- 
bility. No duplicate receipt, certificate, accepted order or other 
voucher shall be issued or put in circulation, or any liability 
incurred for any petroleum, crude or refined, while any former 
liability remains in force, or any former receipt, certificate, ac- 
cepted order or other voucher shall be outstanding and uncan- 
celled, except such original paper shall have been lost, in which 
case a duplicate plainly marked "duplicate" upon the face, and 
dated and numbered as the .lost original was dated and num- 
bered, may be issued. No receipt, voucher, accepted order, cer- 
tificate or written evidence of liability of such company on which 
petroleum, crude or refined, has been delivered, shall be re-is- 
sued, used or put in circulation. No petroleum, crude or refined, 
for which a receipt, voucher, accepted order, certificate or lia- 
bility incurred, shall have been issued or put in circulation, shall 
be delivered, except upon the surrender of the recent, voucher, 
order or liability representing such, petroleum, except upon af- 
fidavit of loss of such instrument made by the former holder 
thereof. No duplicate receipt, certificate, voucher, accepted or- 
der or other evidence of liability, shall be made, issued or put 
in circulation until after notice of the loss of the original, and 
of the intention to apply for a duplicate thereof, shall have been 
given by advertisement over the signature of the owner thereof 
in at least four successive issues of a daily or weekly newspaper 



7<30 MORRISON'S OIL EIGHTS 

published in the county where such duplicate is to be issued. 
Every receipt, voucher, accepted order, certificate or evidence 
of liability, when surrendered, or the petroleum represented 
thereby delivered, shall be immediately cancelled by stamping 
and punching the same across the face in large and legible let- 
ters with the word ' 'cancelled,' ' and giving the date of such can- 
cellation; and it shall then be filed and preserved in the prin- 
cipal office of such company for the period of six years. Id. § 
2841. 

Removal of Oil without Written Consent of Owner. 

14. No company, its officers or agents or any person or per- 
sons engaged in the transportation or storage of petroleum, 
crude or refined, shall sell or encumber, ship, transfer, or in any 
manner remove or procure or permit to be sold, encumbered, 
shipped, transferred, or in any manner removed from the tanks 
or pipes of said company engaged in the business aforesaid, any 
petroleum, crude or refined, without the written order of the 
owner or owners thereof. Act 1891, ch. 44, § 2842. 

Verified Monthly Statements to Be Posted. 

15. Every company now or hereafter engaged in the business 
of transporting by pipe lines, or storing crude or refined petro- 
leum in this State, shall, on or before the tenth day of eacli 
month, make or cause to be made and posted in its principal 
business office in this State in an accessible and convenient place 
for the examination thereof by any person desiring such exam- 
ination, and shall keep so posted continuously until the next suc- 
ceeding statement is so posted, a statement plainly written or 
printed, signed by the officer, agent, person or persons having 
charge of the pipes and tanks of said company, and also by the 
officer or officers, person or persons, having charge of the books 
and accounts thereof, which statement shall show in legible and 
intelligent form the following details of the business : 

First. — How much petroleum, crude or refined, was in the 
actual and immediate custody of such company at the begin- 
ning and close of the previous month, and where the same was 



STATU STATUTES 781 

located or held; describing in detail the location and designation 
of each tank or place of deposit, and the name of its owner. 

Second. — How niueK petroleum, crude or refined, was re- 
ceived by such company during the previous month. 

Third. — How much petroleum, crude or refined, was deliv- 
ered by such company during the previous month. 

Fourth. — For how much petroleum, crude or refined, such 
company was liable for the delivery or custody of to other cor- 
porations, companies or persons at the close of the month. 

Fifth. — How much of such liability was represented by out- 
standing receipts or certificates, accepted order or other vouch- 
ers, and how much was represented by credit balances. 

Sixth. — That all the provisions of this Act have been faith- 
fully observed and obeyed during the said previous month. 

The statement so required to be made shall also be sworn to 
by said officers, agent, person or persons before some officer 
authorized by law to administer oaths, which oath shall be in 
writing, and shall assert the familiarity and acquaintance of the 
deponent with the business and condition of such company, and 
with the facts sworn to, and that the statements made in the 
said report are true. Id. § 2843. . 

Oil on Hand to Tally with Its Vouchers. 

16. All amounts in the statements required by this Act, when 
the petroleum is handled in bulk, shall be given in barrels and 
hundredths of barrels reckoning forty-two gallons to each barrel, 
and when such petroleum is handled in barrels or packages, the 
number of such barrels or packages shall be given, and such 
statements shall distinguish between crude and refined petro- 
leum, and give the amount of each. Every company engaged in 
the business aforesaid, shall at all times have in their pipes and 
tanks an amount of merchantable oil equal to the aggregate of 
outstanding receipts, certificates, accepted orders, vouchers, ac- 
knowledgments, evidences of liability and credit balances, on 
the books thereof. Id. § 2844. 



782 MORRISON'S OIL RIGHTS 

Fine and Imprisonment for Unauthorized Vouchers. 

17. Any company, its officers or agents, who shall make or 
cause to be made, sign or cause to be signed, issue or cause to 
be issued, put in circulation or cause to be put in circulation, 
any receipt, accepted order, certificate, voucher or evidence of 
liability, or shall sell, transfer or alter the same, or cause such 
sale, transfer or alteration, contrary to the provisions of this 
Act, or shall do or cause to be done, any of the acts prohibited 
by the thirteenth section of this Act, or omit to do any of the 
acts by said section directed, shall be guilty of a misdemeanor, 
and on conviction thereof shall be sentenced to pay a fine of not 
exceeding one thousand dollars, and undergo imprisonment not 
less than ten days nor exceeding one year. Id. § 2845. 

Removal of Oil without Written Consent. \ 

18. Any company, its officers, or agents, who shall sell, en- 
cumber, transfer or remove, or cause or procure to be sold, trans- 
ferred or removed from the tanks or pipes of such company, any 
petroleum, crude or refined, without the written consent of the 
owner or owners thereof, shall be guilty of a misdemeanor, and 
on conviction thereof shall be sentenced to pay a fine of one 
thousand dollars and undergo an imprisonment of not less than 
ninety days and not exceeding one year. Id. § 2846. 

Unconscionable Fines for Failure to Make Reports. 

19. Any company engaged in the business of transporting 
by pipe lines or storing petroleum, crude or refined, and each 
and every officer or agent of such company who shall neglect or 
refuse to make the report and statement required by the fif- 
teenth section of this Act, within the time and the manner di- 
rected by said section, shall forfeit and pay the sum of one 
thousand dollars, and in addition thereto the sum of five hun- 
dred dollars for each day after the tenth day of the month that 
the report and statement required by said section fifteen shall 
remain unposted as therein directed. Id. § 2847. 



STATE STATUTES 783 

Oil Owners May Demand Showing as to Stock on Hand. 

20. The holder of any receipts, certificates, accepted orders, 
or other vouchers or evidences of liability, or the owners of oil 
in the custody of any such company described and referred to 
in this Act, to an amount not less in the aggregate than ten 
thousand barrels of petroleum, crude or refined, may at any 
time present their petition to the circuit court of any county 
wherein such company may be engaged in the business or have 
its principal office, or to any judge of said court in vacation, 
setting forth under oath, their ownership as aforesaid and de- 
sire for the appointment of examiners for the purposes of this 
section; and upon such petitioners giving bonds to be approved 
by the court or by the judge granting the order, that they will 
pay all expenses and costs that may accrue in the proceedings, 
the court, or any judge thereof, in vacation, shall forthwith ap- 
point such number of impartial, disinterested and expert per- 
sons as may be asked for in said petition, as examiners, and shall 
fix the amount of their compensation : and the court or judge by 
order, shall direct and empower such examiners to immediately 
inspect and measure all the petroleum, crude or refined, in the 
custody of any such company named in the said petition, on the 
day of such inspection, and to examine the books of said com- 
pany relating to the issue and cancellation of receipts, certif- 
icates, accepted orders, vouchers, or evidences of liability, and 
to its open accounts with persons, companies or corporations 
with whom it deals in the receipt and delivery of crude or refined 
petroleum. Such examiners when so appointed shall each imme- 
diately be sworn before any authorized officer to perform his 
duties with fidelity and according to law, which oath shall be 
reduced to writing, signed and filed with the clerk, and they 
shall then make immediate inspection, examination and measure- 
ment, as required by said petition and order and by this Act. 
And it shall be the duty of eacli and every such company, its 
officers, agents and employees, to give immediately upon request 
of any such authorized examiners, all the information demanded 
in said petition and required by this act to be reported, and 
also full access to the offices, tanks, pipes, books and accounts of 
such company. Upon the completion of such inspection, meas- 



781 MORRISON'S OIL RIGHTS 

urement and examination, it shall be the duty of the examiner 
or examiners, or in the event of death, resignation, declination 
or inability to act of any of them, the others, or any of them 
within ten days after their appointment to make to the court 
appointing them, a written, signed and sworn report of such 
examination, inspection and measurement, and file the same of 
record with the clerk thereof, which report shall show: 

First. — How much merchantable and also how much unmer- 
chantable petroleum, crude or refined, they found in the tanks 
and lines of such company, and where the same was located or 
held bj r description of tanks. 

Second. — For the custody or delivery of how much crude or 
refined petroleum they found such company to be liable at the 
same date. 

Third. — How much of such liability was represented by out- 
standing receipts, accepted orders, certificate, vouchers or evi- 
dence of liability, and how much by credit balances. Id., § 2848. 

False Report or Corrupt Conduct of Examiner. 

21. Any examiner so appointed as aforesaid, who shall make 
any false examination, inspection, measurement or report, or 
shall make known directly or indirectly to any person any in- 
formation he may become possessed of in the course of his 
examination, inspection or measurement, except by means of 
his report made and filed in accordance with this Act, or who 
shall receive directly or indirectly any fee, reward or benefit, 
or the promise of any fee, reward or benefit, other than that 
provided by this Act, for the performance or non-performance 
of any duty or thing contemplated by this Act, or connected 
with his said employment, shall be guilty of a misdemeanor, 
and upon conviction thereof shall be sentenced to pay a fine of 
one thousand dollars, and may at the discretion of the court, be 
confined in jail not to exceed one year. Id. § 2849. 

Refusal to Furnish Information a Misdemeanor. 

22. Any officer, agent, manager, superintendent, or employee 
of any company engaged in the transportation by pipe lines of 



STATE STATUTES 785 

petroleum, crude or refined, or the storage thereof, who shall 
refuse or neglect after demand made to give to any authorized 
examiner full and free access to any and all offices, pipes, tanks, 
accounts, books and vouchers required by him in the pursuance 
of his appointment and this Act, shall be guilty of a misde- 
meanor, and upon conviction thereof shall be sentenced to pay 
a fine of not exceeding one thousand dollars, and may at the dis- 
cretion of the Court be confined in jail not to exceed one year. 
Id., § 2850. 

NATURAL GAS DISTRIBUTION AND EXPORTATION 

1 An Act in relation to persons, firms, and corporations en- 
gaged in furnishing, or required by law to furnish, natural gas 
for public use within this State, to provide remedies for the en- 
forcement of this Act and penalties and punishment for viola- 
tions thereof, and to extend the jurisdiction of the public 
service Commission and of the Courts of this State with respect 
thereto. Approved Feb. 17, 1919, Acts p. 273. 

Obscure Introduction or Preamble. 

Sec. 1. That every person engaged in furnishing, or required 
by law (whether statutory or common law) to furnish, natural 
gas for public use, or for the use of the public, or any part of the 
public, whether for domestic, industrial or other consumption, 
within this State, shall to the extent of his supply of said gas 
produced in this State, (whether produced by such person or 
by any other person), furnished for public use within the ter- 
ritory of this State, and for the use of the public and every 
part of the public within the Territory of this State, in or from 
which such gas is produced, or through which said gas is trans- 
ported, or which is served by such person, a supply of natural 
gas reasonably adequate for the purposes, whether domestic, 
industrial, or otherwise, for which natural gas is consumed or 

1 This extremely obscure Act, apparently intended to discriminate 
against all except local interests in natural gas is the subject of a for- 
mal remonstrance by joint resolution of the Pennsylvania legislature on 
page 87 of the 1919 Session Laws of that State. 
M. O. R.— 50. 



786 MORRISON'S GIL R TOUTS 

desired to be consumed by the public, or any part of the public, 
within said Territory in this State, and for which said consumer 
or consumers therein shall apply and be ready and willing to 
make payment at lawful rates. 

Power of Public Service Commission to Compel Supply of Gas. 
And to Compel Connections. Proviso. 

Sec. 2. That in case any person engaged in furnishing, or 
required by law (whether statutory or common law) to furnish, 
natural gas for public use within this State, or for the use of the 
public or any part of the public within this State, shall have a 
production or supply of natural gas which is, or probably will 
be, insufficient to furnish for such use, (for the purposes, wheth- 
er domestic, industrial or otherwise, for which natural gas is 
consumed by the public or any part of the public), within the 
Territory in this State served by such person, then and in that 
event the public service Commission shall have authority, and 
the same is hereby conferred on it, upon the application of any 
such person or any of his consumers within this State and after 
due hearing upon notice and proof to the satisfaction of the 
Commission that public convenience and necessity so require, 
to order any other person engaged in furnishing, or required by 
law (whether statutory or common law) to furnish, natural gas 
for public use within this State, and producing or furnishing 
natural gas for public use in said Territory or transporting the 
same through said Territory, to furnish to such person having 
such insufficient production or supply, natural gas for the par- 
pose of supplying such deficiency, at and during such times, 
upon and at such just and reasonable terms, conditions and 
rates, and in such amounts, as the Commission shall prescribe. 
And whenever, after such hearing upon notice and proof, the 
Commission shall determine that public convenience and neces- 
sity so require, the Commission shall have authority to provide 
for and compel the establishment of a reasonable physical con- 
nection or connections, between the lines, pipes or conduits of 
such person having such excess supply of gas and the lines, 
pipes or conduits of the person having such deficiency of supply, 
and to require the laying and construction of such reasonable 



STATE STATUTES 787 

extensions of lines, pipes or conduits as may be necessary for 
the establishment of such physical connection or connections, 
and to ascertain, determine and fix the just and reasonable terms 
and conditions of such connection or connections, including just 
and reasonable rules and regulations and provision for the pay- 
ment of the costs and expense of making' the same or for the 
apportionment of such cost and expense as may appear just and 
reasonable. Provided, however, that no person shall, by virtue 
of this section, be ordered to furnish natural gas to any other 
person so engaged in furnishing, or required by law to furnish, 
natural gas for public use, except to the extent that the person 
so ordered to furnish natural gas shall, at the time, have a 
production or supply of natural gas in excess of the quantity 
sufficient to furnish a reasonably adequate supply to his con- 
sumers within this State; nor shall any person, by virtue of 
this section, be ordered to furnish natural gas to any other 
person so engaged in furnishing or required by law to furnish, 
natural gas for public use in a Territory within this State, if 
and when the said person having said excess shall, to the extent 
of such excess, be ready and willing to furnish, and within such 
time as the Commission shall prescribe shall actually furnish to 
the consumers within said Territory a reasonably adequate sup- 
ply of natural gas. 

Prior Public Service Commission Acts. 

Sec. 3. That insofar as the same shall not be in conflict with 
tli is Act, all of the authority, powers, jurisdiction and duties 
confered and imposed on the Public Service Commission by the 
Act entitled, "An Act to create a Public Service Commission and 
to prescribe its powers and duties, and to prescribe penalties for 
the violations of the provisions of this Act," passed February 
twenty-first, one thousand nine hundred and thirteen, as 
amended by the Act entitled, "An Act to amend and re-enact 
sections one, two, three, four, five, nine, ten, fourteen, fifteen and 
twenty-two, of chapter nine of the Acts of one thousand nine 
hundred and thirteen, creating a Public Service Commission, 
prescribing its powers and duties, and penalties for violation of 
the provisions of said chapter, and to add thereto six sections 



<88 MORRISON'S OIL RIGHTS 

to be known as sections twenty-three, twenty-four, twenty-five, 
twenty-six, twenty-seven, twenty-eight, enlarging the powers 
and duties of said Public Service Commission, prescribing addi- 
tional penalties and giving to the Commission power to punish 
for contempt," passed February tenth, one thousand nine hun- 
dred and fifteen, are hereby conferred and imposed on the Pub- 
lic Service Commission in respect to the subject matter of this 
Act, or any part thereof. 

Injunction, Mandamus and Other Relief. 

Sec. 4. That in case of violation of any provision of this Act 
any person aggrieved or affected thereby may complain thereof 
to the Public Service Commission in like manner, and thereupon 
such procedure shall be had, as is provided in respect to other 
complaints to or before said Commission, and all such proceed- 
ings and remedies may be taken or had for the enforcement or 
review of the order or orders of said Commission, and for the 
punishment of the violation of such order or orders, as are pro- 
vided by law in respect to other orders of said Commission. In 
case of the violation of any provision of this Act, the Public 
Service Commission, or any person aggrieved or affected by such 
violation, in his own name, may apply to any Court of competent 
jurisdiction by a bill for injunction, petition for writ of man- 
damus or other appropriate action, suit or proceeding, to com- 
pel obedience to and compliance with this Act, or to prevent the 
violation of this Act, or any provision thereof, pending the pro- 
ceedings before said Commission, and thereafter until final de- 
termination of any action, suit or proceeding for the enforce- 
ment or review of the final order of said Commission ; and such 
Court shall have jurisdiction to grant the appropriate order, 
judgment or decree in the premises. 

Fine and Imprisonment. 

Sec. 5. That if any person subject to the provisions of this 
Act shall fail or refuse to comply with any requirement of the 
Commission hereunder, such person shall be subject to a fine of 
not less than one hundred dollars nor more than five hundred 



STATE STATUTES 789 

dollars for each offense; and such person, or the officers of the 
corporation, where such person is a corporation, may be indicted 
for their failure to comply with any requirement of the Commis- 
sion under the provisions of this Act, and upon conviction there- 
of, may be fined not to exceed five hundred dollars, and in the 
discretion of the Court, confined in jail not to exceed thirty 
clays. Every day during which any person, or any officer, agent 
or employee of such person, shall fail to observe and comply with 
any order or direction of the Commission, or to perform any 
duty enjoined by this Act, shall constitute a separate and dis- 
tinct violation of such order or direction of this Act, as the casj 
may be. 

Civil Remedy. Defendant Compelled to Criminate Himself. 

Sec. 6. That any person claiming to be damaged by any viola- 
tion of this Act may bring suit in his own behalf for the re- 
covery of the damage from the person or persons so violating the 
same in any circuit Court having jurisdiction. In any such 
action the Court may compel the attendance of the person or 
persons against whom said action is brought, or any officer, di- 
rector, agent or employee of such person or persons, as a witness, 
and also require the production of all books, papers and docii- 
ments which may be useful as evidence, and in the trial thereof 
such witness may be compelled to testify, but any such witness 
shall not be prosecuted for any offense concerning which he is 
compelled hereunder to testify. 

"Person" Defined. 

Sec. 7. That the word "person" within the meaning of this 
Act shall be construed to mean, and to include, persons, firms 
and corporations. 

Constitutionality Clause. 

Sec. 8. That the sections, provisions and clauses of this Act 
shall be deemed separable each from the other, and also in re- 
spect to the persons, firms, corporations and consumers men- 
tioned therein or affected thereby, and if any separable part of 



7.90 MORRISON'S OIL RIGHTS 

this Act be, or be held to be unconstitutional or for any reason 
invalid or unforceable, the remaining parts thereof shall be and 
remain in full force and effect. 

Repeal. 

Sec. 9. That all Acts and parts of Acts in conflict with this 
Act are hereby repealed. 



WYOMING. 

Ten Days Allowed to Stop Waste. 

It shall be unlawful for any person or corporation having 
possession or control of natural gas or oil well, whether as a 
contractor, owner, lessee, agent or manager, to allow or permit 
the flow of gas or oil from any such well to escape into the open 
air, without being confined within such well or proper pipes, or 
other safe receptacle for a longer period than ten (10) days 
next after gas or oil shall have been struck in such well. And 
thereafter all such gas or oil shall be safely and securely confined 
in such well pipes or other safe and proper receptacles. Sec. 1, 
Act 1913, p. 37. Approved Feb. 21. 

Abandoned Wells, How Plugged. Shot Wells. 

Whenever any well shall have been sunk for the purpose of 
obtaining natural gas or oil or exploring for the same, and shall 
be abandoned or cease to be operated for utilizing the flow of 
gas or oil therefrom, it shall be the duty of any person or cor- 
poration having the custody or control of such well at the time 
of such abandonment or cessation of use, and also of the owner 
or owners of the land wherein such well is situated, to properly 
and securely stop and plug the same as follows: If such well 
has not been "shot" there shall be placed in the bottom of the 
hole thereof a plug of well seasoned pine wood, the diameter of 
which shall be within one-half inch as great as the hole of such 
well, to extend at least three feet above the salt water level, 
where salt water has been struck; where no salt water has been 



STATE STATUTES 791 

struck such plug shall extend at least three feet from the bottom 
of the well; In both cases such wooden plugs shall be thoroughly 
rammed down and tightened by the use of drilling -tools. After 
such ramming and tightening the hole of such well shall be 
tilled on top of such plug with finely broken stone or sand, which 
shall be placed and well rammed to a point at least four feel 
above the gas or oil-bearing rock; on top of this stone or sand 
there shall be placed another wooden plug at least five feet long 
with diameter as aforesaid, which shall be thoroughly rammed 
and tightened. In case such well shall have been "shot" the bot- 
tom of the hole thereof shall be filled with a proper and sufficient 
mixture of sand stone and dry cement, so as to form a concrete 
up to a point at least eight feet above the top of the gas or oil- 
bearing rock or rocks and on top of this filling shall be placed a 
wooden plug at least six feet long, with a diameter as aforesaid, 
which shall be properly rammed as aforesaid. Sec. 2, Id. 

Proof of Plugging to Be Recorded. 

Whenever any person, persons or corporation having aban- 
doned or ceased operating any well or wells, such person or cor- 
poration shall file with the County Clerk of the county in which 
such well or wells are located, a sworn statement setting out the 
maimer in which such well or wells have been plugged and the 
time that same were plugged, and the location of said well or 
wells. Said statements shall be sworn to by at least two persons 
who shall have assisted in the actual work of so plugging said 
well or wells. Sec. 3, Id. 

Fine for Violation. 

Any person violating any of the provisions of this chapter 
shall be deemed guilty of a misdemeanor and be punishable by 
a fine of not more than five hundred dollars ($500.00) and not 
Jess than one hundred dollars ($100.00) in the discretion of the 
Court, and all such fines when so collected shall be paid into the 
t reasury of the county. Sec. 4, Id. 



792 MORRISON'S OIL RIGHTS 

Adjacent Parties May Plug at Owners Cost. 

Sec. 5. Whenever any person or corporation in possession or 
control of any well in which natural gas or oil ha* been found 
shall fail to comply with the provisions of this chapter, any 
person or corporation lawfully in possession of lands situated 
adjacent to or in the vicinity or neighborhood of such well may 
enter upon the lands upon which such well is situated and take 
possession of such well from which gas or oil is allowed to escape 
in violation of the provisions of section 1 hereof, and pack and 
tube such well and shut in and secure the flow of gas or oil, 
and maintain in a civil action in any Court of competent jurisdic- 
tion in this State against the owner, lessee, agent or manager of 
said well, and each of them jointly and severally to recover the 
cost and expense of such tubing and packing, together with attor- 
ney's fees and costs of suit. This shall be in addition to the 
penalties provided for by section 4 hereof. Sec. 5, Id. 

TAX ACT 

Gross Product of Well to Be Assessed. 

The gross product of all mines and mining claims from which 
gold, silver and other precious metals, soda, saline, coai, petro- 
leum or other crude or mineral oil, or natural gas, or other 
valuable deposit is, or may hereafter be produced, while the 
same are being worked or operated, but not while the same are 
simply in the course of development, shall be returned by the 
owner, owners, lessee or operator thereof for assessment for 
taxation, assessed for taxation, and taxed in the manner pro- 
vided for in this chapter, and such tax shall be in addition to 
any tax which may be assessed upon the surface improvements 
of such mines or mining claims, and in lieu of taxes upon the 
land of such claims while the same are being worked or operated. 
Sec. 1, Act of 1917, p. 9, amending Comp. Stat. § 2449. 

Owner to Make Report of Product. 

The owner, owners^ lessee or operator of mines or mining 
claims from which gold, silver and other precious metal, soda, 



STATE STATUTES 793 

saline, coal, petroleum or other crude or mineral oil, or natural 
gas, or other valuable deposits is produced, but not while the 
same are simply in the course of development, shall, not later 
than the second Monday in January in each and every year, 
file with the state board of equalization a sworn assessment 
schedule statement setting forth the gross product in tons, gal- 
lons or thousands of cubic feet, as the case may be, of such mine 
or mineral claim during the calendar year expiring immediately 
preceding the first day of January of the then current year. If 
the return aforesaid be not received by the second Monday in 
January, as herein provided for [,] or if received and the State 
board of equalization shall believe that the return is not full, 
complete and correct, it shall be the duty of said board to pro 
eeed to obtain the facts and information aforesaid in any manner 
that may appear most likely to secure the same. Sec. 2, Id 
amending Comp. Stat. § 2450. 

State Board to Fix the Valuation. 

The State board of equalization shall at least ten days before 
the date fixed for making assessment, classify and prescribe and 
fix the valuation, each year, for the assessment of the gross prod- 
uct, in tons, gallons or thousands of cubic feet, as the ease niay 
be, of all mines or mining claims from which gold, silver or other 
precious mineral, soda saline, coal petroleum or other crude or 
mineral oil, or natural gas, or other valuable deposits are pro- 
duced. Sec. 3, amending Comp. Stat. § 2451. 



STATE GEOLOGIST. 

State Geologist to Be Appointed. 

Sec. 208. There shall be a State geologist of the State of Wy- 
oming, who shall be appointed by the governor by and with the 
consent of the Senate. He shall hold his office for the term of 
six years or until his successor shall have been appointed and 
qualified. See. 1, Act 1901, chap. 45. 



794 MORRISON'S OIL RIGHTS 

Oath and Bond. 

Sec. 209. Before entering upon the duties of his office, the 
State geologist so appointed as hereinbefore provided, shall take 
the oath required by the Constitution of this State and shall give 
a bond to the State of Wyoming with sureties to be approved 
by the governor in the sum of two thousand dollars, conditioned 
for the faithful performance of the .duties of his office. L. 1901, 
ch. 45, § 2. 

Removal from Office. 

Sec. 210. The governor shall have the power to remove from 
office any person appointed to the position of State geologist 
for cause. The grounds for which shall be in writing and filed 
in the office of the Secretary of State. L. 1901, ch. 45, § 3. 

General Duties. 

Sec. 211. It shall be the duty of the State geologist to make 
examinations and reports on any State or school lands when so 
requested by the State Land Board or the State School Land 
Board and to make a written report concerning the geology of 
any lands in which the State of Wyoming is or may hereafter 
become interested and on such other matters as the respective 
State boards having to do with State lands or State school lands 
may desire information upon. Such reports as provided for 
in this section shall be in writing and filed with the Commis- 
sioner of Public lands. He shall be charged with the duty of 
enforcing all of the laws of the State of Wyoming rein ting to 
the oil industry. It shall be his further duty to perform such 
other Acts as are provided by the laws of the State of Wyoming 
relating to the Oil and Mineral Deposits, (other than Coal De- 
posits). Sec. 4, Act 1901, chap. 45. Amended 1919, p. 99. 

Sections 212, 213, 214 of the Compiled Statutes of Wyoming 
which were a re-print of sections 5, 6, and 7 of the Act of 1901, 
eh. 45, concerning fees, records and reports, were repealed by 
the Act of February 22, 1919, page 99, above cited. 



STATE STATUTES 79-") 



Salary. 



Sec. 215. The State Geologist shall receive an annual salary 
of thirty-six hundred dollars to be paid monthly by the State 
treasurer, upon a warrant of the State Auditor for this pur- 
pose." L. 1901, sec. 8, ch. 45, amended 1919, p. 99. 

Interest in mining' property disqualifies. 

Sec. 216. No person holding a pecuniary intetrest in a mining- 
property in this State shall be eligible to fill or hold the office of 
State geologist. L. 1901, ch. 45, § 9. 

Failure to Utilize Natural Gas. 

Section 1. The use, consumption or burning of natural gas 
taken or drawn from any natural gas well or wells, or borings 
from which natural gas is produced for the products where such 
natural gas is burned, consumed or otherwise wasted without the 
heat therein contained being fully and actually applied and util- 
ized for other manufacturing purposes or domestic purposes is 
hereby declared to be a wasteful and extravagant use of natural 
gas and shall be unlawful when such gas well or source of sup- 
ply is located within ten miles of any incorporated town or in- 
dustrial plant. Act Feb. 24, 1919, Sess. L., p. 169. 

Wasteful Use in Certain Processes Forbidden. 

Sec. 2. No person, firm or corporation, having the possession 
or control of any natural gas well or wells, except as herein pro- 
vided, or borings from which natural gas is produced whether 
as a contractor, owner, lessee, agent or manager, shall use, sell, 
or otherwise dispose of natural gas, the product of any such well 
or wells, or borings for the purpose of manufacturing or pro- 
ducing carbon or other resultant products from the burning or 
consumption of such natural gas, without the heat therein con- 
tained being fully and actually applied and utilized for other 
manufacturing purposes or domestic purposes. Id. 



796 MoKi«Tso\\s' oil bights 

Confiscatory Penalty. 

See. 3. Any person, firm or corporation violating any of the 
provisions of this Act shall be guilty of a misdemeanor and 
.shall be punished by a fine of not less than one hundred dollars 
($100.00) or more than one thousand dollars ($1000.00) for 
each offense and each and every day in which any person, firm 
or corporation shall violate any of the provisions hereof shall 
constitute a separate offense hereunder and subject the offender 
to the penalty hereby provided. Id. 



CHAPTER 84. 

OIL INSPECTION LAW. 

As before stated, inspection not being to any extent within the 
vscope of this book, the Statutes of the several States are not 
printed but we insert the Indiana Act of 1919 as an instance 
of their general scope. It is perhaps later and more detailed 
thau any other. 

These inspection laws are intended to prevent the sale of oil 
until all possible precautions have been taken to secure against 
its inflammatory and explosive qualities; a danger which under 
no system can be entirely eliminated, also for the purpose of 
preventing the sale of mixtures and compound of inferior 
strength or mislabeled, so as to deceive the ordinary purchaser. 

Indiana places the carrying out of the law under the State 
food and drug Commission and almost every State delegates 
like powers to some sort of board or other bureau of delegated 
authority and provides for the appointment of officials whose 
services are more or less inquisitorial and for the exaction of 
fees. 

The tendency of these Acts is to exercise the undoubted right 
of inspection and the less defensible right to license for the 
prohibited purpose of collection of revenue under the protection 
of the conceded powers to inspect and license. Decisions on 
these points are founcl under Taxation, chap. 37 of this book. 



CHAPTER 83, ACTS 1919 

An act providing for an [and] requiring the inspection and 
branding of products of petroleum before the same shall be of- 
fered for sale, or sold, or consumed, for illuminating purposes 
within the State of Indiana, and providing for, and requiring, 

797 



798 MORRISON'S OIL RIGHTS 

the inspection and branding of gasoline, benzine, naphtha and 
like products of petroleum under whatever name called, pre- 
scribing tests for inspections and the manner of making inspec- 
tions, imposing duties upon the State food and drug Commis- 
sion [er] thereunder, and fixing his compensation for the 
discharge of the duties imposed upon him, providing for the 
appointment of oil inspectors, prescribing their duties and fixing 
their compensation, fixing inspection fees and providing for 
their collection, providing penalties for violations of the Act, 
repealing laws in conflict therewith, providing that after mid- 
night, September 30, 1919, an Act of the seventy-first general 
assembly entitled "An Act regulating the inspection of oil, 
gasoline and other petroleum products, providing penalties for 
its violation, repealing all former laws and laws in conflict 
therewith and declaring an emergency," shall have no force and 
effect and shall be repealed, and providing the time when the 
same shall be in force and effect. 

Oil Inspection — Method. 

Section 1. Be it enacted by the General Assembly of the 
State of Indiana, That all mineral or petroleum oil or any oil fluid 
or substance which is a product of petroleum or into which pe- 
troleum or any product of petroleum enters or is found as a 
constitutent element, whether manufactured within this State 
or not, shall be inspected, approved and marked by brand or sten- 
cil as provided in, and required by this Act, before being offered 
for sale or sold for consumption for illuminating purposes with- 
in this State, or consumed for illuminating purposes within this 
State. Such inspection shall be made by the apparatus known 
as the "Foster cup" or Foster's automatic oil tester in accordance 
with the following directions: 

(1) Kemove the thermometer with its mountings from the oil 
cup. 

(2) Lift off the oil cup containing the flashing taper and fill 
open water bath with water to the mark upon the inside. 

(3) Take the wick holder from the oil cup, and fill this ves- 
sel with the oil to be tested, pouring in the oil at the place of 
the wick holder- and noting the gauge mark at the thermometer 



OIL INSPECTION LAW 799 

hole, pouring very gradually as the surface approaches the 
gauge mark. The gauge mark consists of a small pendant shelf 
and the oil cup is property filled when the upper surface of the 
oil just adheres to the lower surface of the gauge mark. Too 
much care cannot be taken at this point. Having ceased pour- 
ing, tip the cup so that the oil flows away from the gauge, then 
gradually restore it to the horizontal, and if the surface does 
not again adhere, add a little more oil. 

(4) Adjust the wick of the flashing taper to give a flame that 
does not exceed one-quarter of an inch in height and that ex- 
hibits as much blue at its base as yellow at its top. 

(5) Set the oil cup on top and into the water bath, return 
the flashing taper to its place, inverting the conical thimble 
around it, and return the thermometer to its place upon the cup. 
In doing this be sure that the casing of the latter is pushed down 
upon the cup as far as it will go. 

(6) Fill the lamp beneath half full of alcohol, light and place 
it beneath the water bath. Note the rate of increase in tem- 
perature as shown by the thermometer and adjust the wick to 
raise the temperature at the rate of two (2) degrees per minute. 
When the temperature has reached one hundred (100) degrees, 
light the flashing taper and observe it closely. As soon as the 
oil under test has reached its "flashing point," the flame of this 
taper will be extinguished by the first "flash," and the point of 
attention is the temperature at the instant the flame of the taper 
is extinguished. This "flashing point" is the point of tempera- 
ture at which the oil generates vapor. 

Flash Test 120° Fahrenheit. 

No mineral oil or petroleum oil or any oil fluid or substance 
which is a product of petroleum, or into which petroleum or any 
product of petroleum enters or is found as a constituent ele- 
ment, whether manufactured in this State or not, which by the 
test herein prescribed flashes at any temperature below one 
hundred and twenty (120) degrees Fahrenheit, shall be offered 
Cor sale or sold for consumption for illuminating purposes with- 
in this State, or used for illuminating purposes within this 
State. 



SOO M OUR ISDN'S OIL RIGHTS 

Sale or Use Prohibited before Inspection. 

Sec. 2. Gasoline, benzine, naptha and all like products of pe- 
troleum, under whatever name called, whether manufactured in 
this State or not, having a lower flash test than provided in this 
Act for illuminating oils, shall be inspected as provided in this 
Act before being offered for sale or sold for consumption within 
this State, or used in this State. 

Under Supervision of State Food and Drug Commissioner — 
Compensation and Reports. 

Sec. 3. It shall be the duty of the State food and drug com- 
missioner, and of the oil inspectors appointed, with" the approval 
of the governor, by him, to inspect and brand, in the way and 
manner provided for in and required by this Act, all mineral or 
petroleum oil or any oil fluid or substance which is a product of 
petroleum or into which petroleum or any product of petroleum 
enters, or is found as a constituent element, whether manufac- 
tured within this State or not, required by this Act to be in- 
spected and branded, before the same shall be offered for sale, 
or sold, for consumption for illuminating purposes within this 
State, and before the same shall be consumed for illuminating 
purposes within this State, and to inspect and brand in the way 
and manner provided in, and required by, this Act, gasoline, 
benzine, naptha and all like products of petroleum, under what- 
ever name called, whether manufactured within this State or 
not, having a lower flash test than provided in this Act for 
illuminating oils, required by this Act to be inspected and 
branded, and to cause all provisions of this Act to be observed 
and enforced. The State food and drug commissioner shall su- 
pervise under the provisions of this Act all inspections and 
brandings required by this Act, and he shall perform any and 
all duties required of him by this Act, which duties shall be 
additional to the duties imposed upon him as State food and 
drug commissioner. lie shall keep a record of all inspections 
made in the State by himself as food and drug commissioner 
acting hereunder, and by the oil inspectors appointed under this 
Act, showing the time and place of each inspection, the numbc** 



OIL INSPECTION LAW 801 

of containers inspected, the number of gallons inspected in each 
container, the name of the petroleum product inspected, the 
fees charged for the inspection, by whom inspected, for whom 
inspected, the result of the inspection, and any other facts that 
shall be proper to effect an efficient execution of this Act. He 
shci 11 require all oil inspectors appointed under this Act to make 
monthly reports to him of their inspections, and such other re- 
ports as he may from time to time desire made to him touching 
their duties as oil inspectors under this Act. 

Appointment and Removal of Oil Inspectors. 

The State food and drag commissioner, under the provisions 
of this Act, is empowered to appoint, with the approval of the 
governor, a sufficient number of oil inspectors properly to make 
all inspections provided for in this Act, and. he may remove at 
any time, with the approval of the governor, any oil inspector 
or oil inspectors. The number of inspection districts in the State 
shall be determined and their Territory denned by the State 
food and drug commissioner, with the approval of the governor, 
which inspection districts may from time to time be changed as 
to number and Teritory by the State food and drug commis- 
sioner, with the approval of the governor. The State food and 
drug commissioner under this Act is empowered to go into any 
part of the State and himself make any inspection required by 
this Act to be made, and he may transfer, with the approval 
of the governor, any oil inspector from any inspection district 
to any other inspection district. He shall prepare forms of all 
stencils and brands provided for in this Act, and shall make 
rules and regulations for the guidance of the oil inspectors in 
the discharge of their duties under this Act not inconsistent with 
the provisions of this Act, and such rules and regulations shall 
be binding on all oil inspectors in the State. The State food and 
drug commissioner before entering upon the discharge of his 
duties under this Act shall execute to the State a bond in the 
penal sum of twenty-five thousand dollars ($25,0000) with surety 
to be approved by the Secretary of State conditioned upon the 
faithful performance of the duties imDosed upon him by this 
Act, and such bond, when approved shall be filed with the Sec- 
M. D. R.— 51. 



802 MORRISON'S OIL RIGHTS 

retary of State. The State food and drug commissioner is em- 
powered to employ as many stenographers and clerks and fix 
their compensation, with the approval of the governor, as may 
be necessary properly to care for the duties imposed upon him 
by this Act, but the aggregate amount of all compensation paid 
to stenographers and clerks employed in the office of the State 
food and drug commissioner under this Act, shall not exceed 
three thousand six hundred dollars ($3,600) annually. The 
State shall furnish to the State food and drug commissioner 
a. suitable office at Indianapolis, Indiana, for the discharge by 
him of his duties under this Act. He shall make to the governor 
annually a report of all inspections and transactions under this 
Act, and shall from time to time make such other reports to the 
governor as may be requested of him by the governor. The 
State food and drug commissioner shall be paid the sum of five 
hundred dollars ($500.00) per annum for the discharge of his 
duties under this Act, which sum shall be additional to the salary 
now paid to him under the law as State food and drug commis- 
sioner and chemist to the State board of health. The State 
food and drug commissioner under this Act shall also be allowed 
such further amount as he may actually and necessarily expend 
in traveling in the discharge of his duties under this Act. The 
compensation of five hundred dollars ($500.00) to be paid to 
the State food and drug commissioner for his services under 
this Act, and the compensation to be paid to the stenographers 
and clerks provided for in this Act and all traveling expenses 
of the State food and drug commissioner provided for in this 
Act, shall be paid monthly from the State treasury upon the 
warrant of the auditor of State issued upon vouchers signed 
by the State food and drug commissioner under this Act. There 
is now hereby appropriated annually for the payment of all 
compensation, expenses and sums provided for in this section, 
from the general fund of the State treasury not otherwise ap- 
propriated, an amount sufficient to pay said compensation, ex- 
penses and sums. 

Bond of Inspectors— Duties — Salaries. 

See. 4. Each oil inspector appointed under this Act shall ex~ 



OIL INSPECTION LAW 803 

ecute a bond payable to the State of Indiana in the penal sum 
of five thousand dollars ($5,000) with surety to be approved by 
the Secretary of State, conditioned upon the faithful perform 
ance by him of the duties imposed upon him by this Act, which 
bond when approved shall be filed with the Secretary of State. 
Before entering upon his duties as oil inspector under this Act, 
each person appointed an oil inspector shall take and subscribe 
an oath faithfully and honestly to discharge the duties imposed 
upon him by this Act, which oath shall also be filed with the 
Secretary of State. Oil inspectors appointed under this Act 
shall inspect all products of petroleum required by this Act 
to be inspected, and shall comply with the rules and regulations 
issued by the State food and drug commissioner, for their 
guidance in the discharge of their duties under this Act. It 
shall be the duty of all oil inspectors, appointed under this Act, 
on the first day of eacli month to make a true and accurate re- 
turn under oath to the State food and drug commissioner on 
forms prepared by him, of all inspections made during the pre- 
ceding month, giving the time and place of each inspection, 
the number of containers inspected, the number of gallons in- 
spected in each container, the name of the petroleum product 
inspected, the fees charged for the inspection with the amount of 
fees collected by him, for whom inspections were made, the re- 
sult of the inspection, and such other facts as may be required 
of him by the State food and drug commissioner. No oil in- 
spector shall be entitled to any compensation for his services for 
any month until he shall have fully complied with the require- 
ments of this Act. The reports of oil inspectors filed with the 
State food and drug commissioner under this Act, and the rec- 
ords of the State food and drug commissioner under this Act, 
shall at all times be kept in the office of the State food aud 
drug commissioner, and shall at all times be open for the ex- 
amination and information of all persons who may desire to 
see and examine the same. No oil inspector shall be interested 
in manufacturing, dealing, or vending in any product of pe- 
troleum which it is his duty under this Act to inspect. It shall 
be the duty of the State food and drug commissioner, and of 
all oil inspectors appointed under this Act, to provide themselves, 



804 MORRISON'S OIL RIGHTS 

at their own expense, with the necessary instruments, apparatus 
and stencils for the testing and branding of all petroleum prod- 
ucts required to be inspected and branded under this Act. For 
compensation for services under this Act, each inspector shall 
be paid per month a sum, not exceeding one hundred anctt 
twenty-five dollars ($125), equal in amount to the total of all' 
fees for inspections made by him in the month for which the 
compensation is paid. No oil inspector shall receive compensa- 
tion for services in any month in excess of one hundred twenty- 
five dollars ($125). In addition to the compensation for services 
in this section provided, each oil inspector shall be allowed and 
paid at time of the payment of his monthly compensation for 
services, such further amount as he has actually and necessarily 
expended in traveling in the discharge of his duties as oil in- 
spector in the month for which compensation for services is 
paid; Provided, That after the payment of compensation for 
his services there remains from the total of all fees charged 
under this Act for inspections made by him in the month for 
which the compensation for services is paid, any excess from 
which the traveling expenses may be paid, and only to the extent 
of this excess shall any traveling expenses be allowed or paid. 
Compensation for services of oil inspectors, and traveling ex : 
penses of oil inspectors actually and necessarily incurred in 
the discharge of their duties under this Act, shall, within the 
limitations provided in this section, be paid from the oil in- 
spection fund in the State treasury, which fund is now under 
this Act created, upon warrants of the auditor of State issued 
upon vouchers signed by the State food and drug commissioner 
in the discharge of his duties under this Act. Said oil inspec- 
tion fund is hereby annually appropriated for the payment of 
all compensation, expenses and sums provided by this Act to 
be paid from said oil inspection fund. 

Inspectors' Approval. 

Sec. 5. The State food and drug commissioner and the oil in- 
spectors appointed under this Act, when called upon to make 
inspections required by this Act, shall promptly make such in- 
spections and shall promptly do all things required .of them by 



OIL INSPECTIOM LAW 805' 

this Act. If, upon inspection, any mineral or petroleum oil or 
any oil fluid or substance which is a product of petroleum, or 
into which petroleum, or any product of petroleum, enters or is 
found as a constituent element, which is offered for sale or in- 
tended to be offered for sale for consumption within this State 
for illuminating purposes, or which is intended for consumption 
within this State for illuminating purposes, shall meet the re- 
quirements of this Act, the State food and drug commissioner 
or an oil inspector appointed under this Act shall mark by sten- 
cil or brand, in plain letters, on the tank, cask, barrel or vessel 
containing the same, the word "Approved," with the date of the 
inspection and the name and official designation of the oil in- 
spector making the inspection. If so approved and branded, 
it s'.iall then be lawful for the same to be offered for sale or 
sold for consumption within this State for illuminating pur- 
poses and to be used within this State for illuminating purposes. 
But if the same, upon inspection, shall not meet the require- 
ments of this Act, the State food and drug commissioner, or an 
oil inspector appointed under this Act, shall mark by stencil 
or brand, in plain letters, on the tank, cask, barrel or vessel 
containing the same, the words "Rejected for 'illuminating pur- 
poses," with the date of the inspection, and the name and official 
designation of the oil inspector making the inspection; and it 
shall be unlawful for any manufacturer, owner, vendor, dealer, 
or any other person, to sell or offer for sale the petroleum 
product so rejected and branded, to be consumed within this 
State for illuminating purposes, or to consume the petroleum 
product so rejected and branded for illuminating purposes with- 
in this State. Whoever offers for sale, or sells, for consumption 
for illuminating purposes within this State, or consumes for 
illuminating purposes within this State, such product of petro- 
leum so rejected for illuminating purposes, and so branded, "or 
whoever offers for sale, or sells, for consumption for illuminat- 
ing purposes within this State, or consumes for illuminating 
purposes within this State, any product of petroleum required 
by this Act to be inspected and branded, before the same shall 
have been inspected and branded, as by this Act provided and 
required, shall be guilty of a misdemeanor, and shall, upon con- 



806 MORRISON'S OIL RIGHTS 

viction, be fined in any sum not exceeding* one thousand dollars 
($1,000)., or be imprisoned in the county jail not exceeding 
sixty (60) days, or both. 

Tanks, Casks or Barrels to Be Marked — Penalty. 

Sec. 6. Upon inspection of gasoline, benzine, naphtha, and all 
like products of petroleum, under whatever name called, re- 
quired by section 2 of this Act to be inspected, the State food 
and drug commissioner, or an oil inspector appointed under this 
Act, shall mark by brand or stencil, in plain letters, on the tank, 
cask, barrel or vessel containing the gasoline, benzine, naphtha 
or like products of petroleum, under whatever name called, 
the commercial name of the contents of the tank, cask, barrel 
or vessel inspected, the word "Dangerous," the date of the in- 
spection and the name and official designation of the oil in- 
spector making the inspection; and it shall then be lawful for 
the same to be offered for sale or sold for consumption within 
this State, or to be consumed within this State. It shall be 
unlawful for any manufacturer, owner, vendor, dealer or other 
person to offer for sale, or sell, for consumption within this 
State, or to consume within this State, gasoline, benzine, naphtha, 
or any like product of petroleum under whatever name called, 
whether manufactured in this State or not, until after the same 
has been inspected and marked by brand or stencil, as in this 
Act provided and required. Whoever offers for sale, or sells 
for consumption within this State, or consumes within this 
State, any gasoline, benzine, naphtha, or like products of petro- 
leum, under whatever name called, not inspected and not marked 
by brand or stencil, as in this Act provided and required, shall 
be guilty of a misdemeanor and shall, upon conviction, be 
fined in any sum not exceeding one thousand dollars ($1,000), 
or be imprisoned in the county jail not exceeding sixty (60) 
days, or both. 

Fees for Inspection. 

Sec. 7. Each owner or other person for whom, or at whoso 
request, inspections under this Act are made, shall, pay to the 



OIL INSPECTION LAW 80/ 

State food and drug* commissioner, or to the oil inspector mak- 
ing the inspection, the following fees: 

For a single barrel, package or cask, twenty-five cents (25c) ; 

When the lot inspected does not exceed ten barrels of fifty 
(50) gallons each in the aggregate, for each barrel fifteen cents 
(15c); 

When the lot inspected does not exceed fifty (50) barrels of 
fifty (50) gallons each in the aggregate, for each barrel, ten 
cents (10c) ; 

When the lot inspected exceeds fifty (50) barrels of fifty (50) 
gallons each in the aggregate, for each barrel, four cents (4c). 
All inspection fees under this Act are payable on demand of the 
State food and drug commissioner, or any oil inspector, and in 
no case shall payment of fees for inspections under this Act 
be deferred beyond the tenth day of the next month following 
the month in which the inspection was made, and such fees 
shall be a lien on the petroleum products inspected. Oil in- 
spectors shall promptly remit to the State food and drug com- 
missioner all fees collected by them. The State food and drug 
commissioner shall pay weekly into the State treasury to the 
credit of the' oil inspection fund, all moneys received by him 
under this Act. Any balance remaining in the oil inspection 
fund shall at the end of each fiscal year, revert to the general 
fund in the State treasury. 

Commingling of Contents. 

Sec. 8. If any uninspected product of petroleum, by whatever 
name called, required under this Act to be inspected, shall be 
emptied or transferred into any tank or vessel in which there 
is contained any product of petroleum that has been inspected, 
approved and marked as in this Act required, then the entire 
commingled contents shall be deemed under this Act unin- 
spected. 

Rejected for Illuminating Purposes. 

Sec. 9. If any inspected and rejected product of petroleum 
intended for illuminating purposes, required by this Act to be 



808 MORRISON'S OIL RIGHTS 

inspected, shall be emptied or transferred into any tank or ves- 
sel in which there is contained any inspected and approved 
product of petroleum intended for illuminating purposes re- 
quired by this Act to be inspected, or if any inspected and re- 
jected product of petroleum intended for illuminating purposes, 
required by this Act to be inspected, shall be emptied or trans- 
ferred into any tank or vessel in which there is contained any 
uninspected product of petroleum intended for illuminating 
purposes, required by this Act to be inspected, then the entire 
commingled contents shall be for all purposes of this Act deemed 
rejected, the same as if the entire commingled contents had been 
inspected and rejected, and had been marked and branded 
"Rejected for illuminating purposes." Whoever offers for sale, 
or sells, for consumption for illuminating purposes within this 
State, or consumes for illuminating purposes within this State, 
such commingled contents, or any part thereof, deemed rejected 
under this Act, shall be guilty of a misdemeanor and shall be 
subject to the penalty and punishment provided in section 5 
of this Act. 

Location for Inspection. 

Sec. 10. Any product of petroleum required by this Act to 
be inspected, shall be inspected within this State and may at the 
direction of the State food and drug commissioner, be inspected 
either at the place where the tank, barrel, cask, or other vessel is 
filled with such petroleum product, if filled within this State, or 
at the destination of shipment if within this State. Barrels or 
other receptacles filled from storage tanks with petroleum prod- 
ucts required by this Act to be inspected and marked by stencil 
or brand, which have been inspected and approved as in this 
Act provided, shall be marked by stencil or brand as required 
in this Act without the charge of any additional fees. At the 
time of the inspection of any petroleum product required by this 
Act to be inspected the State food and drug commissioner, or the 
oil inspector making the inspection, shall deliver to the owner, 
or other person for whom or at whose request the inspection was 
made, a certificate showing the making of the inspection, and the 
result thereof, which certificate shall be dated and' signed, and 



OIL INSPECTION LAW 809 

shall be issued in duplicate if so requested by the owner, or other 
person for whom, or at whose request, the inspection was made. 
For the issuing of the certificate no fee shall be charged. 

Wagons or Trucks — Certificates — Penalty. 

Bee. 11. Wagons or trucks from which any petroleum prod- 
uct intended for consumption in this State for illuminating 
purposes, required under this Act to be inspected and marked 
by brand or stencil, is delivered to consumers or dealers, shall 
bear a certificate in duplicate with the certificate issued by the 
State food and drug commissioner, or by an oil inspector, cover- 
ing the contents of the last tank emptied into the storage tank 
from which the wagon or truck was filled. If the contents of the 
wagon or truck be gasoline, benzine, naptha, or like product of 
petroleum, under whatever name called, then the wagon or truck 
shall bear marked on, or affixed to it by stencil or brand, in 
plain letters, the commercial name of its contents with the word 
"Inspected." Whoever, including the driver of the wagon or 
truck, violates any of the provisions of this section shall be 
deemed guilty of a misdemeanor, and, upon conviction, shall 
be subject to a penalty, for each day of the violation of the pro- 
visions of this section, in any sum not exceeding one hundred 
dollars ($100) or be imprisoned in the county jail for a period 
not exceeding thirty (30) days or both. 

Inspection Brand to Be Erased from Barrels, Casks, etc., before 
Sale — Penalty. 

Sec. 12. Any person selling or in any way disposing of an 
empty barrel, cask, vessel or other container, which has been 
marked by brand or stencil by the State food and drug com- 
missioner, or by an oil inspector under this Act before thor- 
oughly cancelling, removing and effacing the inspection brand 
on the same, shall be guilty of a misdemeanor and shall, upon 
conviction, be fined for each offense in any sum not exceeding 
fifty dollars ($50), or be imprisoned in the county jail for any 
period not exceeding sixty (60) days, or both. 



810 MORRISON'S OIL RIGHTS 

False Branding — Penalty. 

Sec. 13. Any person not the State food and drug commis- 
sioner, and not an oil inspector appointed under this Act, who 
shall mark by brand or stencil on any tank, barrel, cask or other 
vessel containing any product of petroleum required under this 
Act to be inspected and marked by brand or stencil with the 
words required by this Act to be marked by brand or stencil 
thereon by the State food and drug commissioner, or by an oil 
inspector under this Act, shall be deemed guilty of a misde- 
meanor and, upon conviction, shall be fined in any sum not ex- 
ceeding one hundred dollars ($100), or be imprisoned in the 
county jail for a period not exceeding thirty (30) days or both. 

Inspection when Not Required. 

Sec. 14. No provision of this Act shall require the inspection 
of miners' lamp-oil, paraffin wax, fuel oil for fuel purposes un- 
der boilers for generating steam, furnaces or retorts in place 
of other fuel in manufacturing plants, or gas-making material 
when sold to gas works for manufacture of gas. 

Inspectors May Enter Premises. 

Sec. 15. In the performance of their duties under the pro- 
visions of this Act, the State food and drug commissioner and 
the oil inspectors appointed under this Act, may enter upon 
the premises 'of any manufacturer, vendor or dealer in any pe- 
troleum product required by this Act to be inspected, and may 
require from any person, firm, corporation or association selling 
any product of petroleum required by this Act to be inspected, 
a statement covering any period desired of the number of bar- 
rels by the person, firm, corporation or association sold. 



CHAPTER 85. 

BLUE SKY LAWS. 

Within recent years a body of statutory law has been enacted 
which, following* a rhetorical allusion in the language of one 
of the opinions on fraudulent stock transactions, to the sale of 
"so many acres of blue sky," has received the designation of 
Blue Sky Laws. 

They cannot be referred to under any specific head because 
they come under several guises but in general they take the 
shape of licenses, insurance regulations, Public Utilities Commis- 
sions or restrictions on corporate organization. 

Their avowed object is to prevent the flotation of corporate 
stock or securities, issued by companies having a legal and 
formal organization but more or less destitute of funds with 
Which to float the enterprise, or property out of which to de- 
velop value, or assets to pay judgments when damages are ad- 
judged against them. 

The purpose is "reform" and with this talismanic word they 
obtain at once the suffrages of all well meaning citizens. But 
their proponents, like most reformers, regard the bill of rights 
and the constitutional safeguards of personal liberty merely as 
obstacles in the way of such reform, to be overridden or set aside 
just as far as the Court will allow this to be clone. 

The Blue Sky Laws of Ohio, South Dakota and Michigan came 
before the Federal Supreme Court in 1916 in a series of cases, 
argued together. They had been attacked in the Courts below 
and in each case held unconstitutional. But the National 'Su-' 
preme Court held them valid under the police power of the 
State and not in violation of the fourteenth amendment and 
that the drastic power given the board to discriminate between 
corporations of good and evil reputation was not arbitrary. In- 
terstate commerce was held not interferrecl with. Hall v. Geiger 

811 



812 MORRISON'S OIL RIGHTS 

Jones Co.; Cad well v. Sioux Falls Co.; Merrick v. Halsey, 242 
U. S. 539-590. 

In the Halsey case the opinion considers the expediency of 
laws of this character, throwing the responsibility upon the 
legislative department and holding that where fraud is possible 
it may be anticipated, and statutes to prevent it will be upheld, 
But neither of the three cases disposes of the argument which 
stands as strong today as before these decisions, not agaiti>t 
the necessity for legislation nor the magnitude of the evil to 
be prevented, but against the means by which it is sought to 
prevent it, to wit: Leaving to boards and Commissions the 
power to decide on personal and property rights practically be- 
yond appeal to judicial protection. 

Alabama 

has no Blue Sky Laws except to require license to persons deal- 
ing in stocks and bonds. Laws of 1915, No. 469. 

Arizona 

has a series of Acts from 1913 to 1919 confined to brokers and 
investment companies and corporations, and associates defined 
into investment companies, requiring full statements and regis- 
tration placing them under the Corporation Commission. These 
Acts are re-enforced with extremely severe penalties. 

Arkansas 

has a full Act passed in 1915, amended in 1917, placing the 
whole subject under the bank commissioner. 

Section 3 of the 1915 Act page 885 contains the list of securi- 
ties excepted from the Act. Hearings are provided foi\but the 
bank commissioner is allowed to act in advance of the hearing. 
The scope is to place almost absolute power in the bank com- 
missioner. The Arkansas Act of 1913 was held valid in Stand- 
ard Home Co. v. Davis, 217 Fed. 904 as to its provisions de- 
manding information from the corporations affected by the law. 



BLUE SKY LAWS 813 



California 



has a full Code ou the subject which confers authority to carry 
out the law on the commissioner of corporations with prescribed 
printed forms. 

The second annual report of the corporation department re- 
views the practical operation of the Act claiming for it, as is 
doubtless true, large benefits to the investing public. But the 
boast that no appeals have been taken from their decisions must 
be qualified by the fact that upon appeal the burden of proof 
is on the appellant and even if successful the relief to be allowed 
seems to be almost nil. The report goes out of its way to select 
oil companies as possibly dangerous wild cats. 

Colorado's Blue Sky Laws 

are limited to insurance companies. Act of 1915, page 264. 

Connecticut 

requires filings with the bank commissioner, licenses and re- 
ports with bonds from investment brokers. 

The Delaware Act. 

of 1915 is limited to foreign corporations, requiring sworn 
statement of their assets and liabilities. 



Florida 

requires permits to sell stock issued on showing details of assets, 
verified. It divides dealers into foreign and domestic invest- 
ment companies. It has been construed that it does not deny 
equal protection to local corporations. Ex parte Taylor, 68 
Fla. 61, 66 So. 292; Ann. Cas. 1916A 701. 

Georgia 

has a full Blue Sky Law requiring the usual reports and non- 
compliance with the law is severely punished. Work on the chain 
gang is provided as one of the punishments, the idea of reforma- 



814 MORRISON'S OIL RIGHTS 

tion of convicts by degradation being a part of the penal system 
of that State. 

Idaho 

has a detailed Bine Sky Law similar to that of Ohio. See refer- 
ences under that State. 

Illinois. 

The law of Illinois is extremely detailed, perhaps more so 
than that of any other State. Among other things a dealer is 
required before securing license to give a resume of his life 
with a showing that he has never been convicted of fraud and 
is open to criticism from any lawyer, who is tenacious for con- 
stitutional protection. 

Indiana's Regulation 

of the topic is committed to the auditor of State who requires 
the usual statements and reports. Foreign investment com- 
panies are compelled to deposit with the auditor $50,000 in 
securities of the class offered for sale. 

Iowa's Blue Sky Law 

of 1915 is voluminous in detail. As it stood in 1913 it was held 
an interference with interstate commerce and to deny equal 
protection of the laws. William' R. Compton Co. v. Allen, 216 
Fed. 537. It is substantially the same as the Ohio law. 

Kansas. 

The Blue Sky Laws, extending from 1911 to 1919, consist of 
the original Act followed by repeated amendments and is sub- 
stantially according to the tenor of the Ohio law. 

The Kentucky Act 

dates back to 1902, seems to be confined to investment companies 
and is. moderate and conservative in its provisions. ■ 



BLUE SKY LAWS 815 



Louisiana 



requires itinerant brokers to take out licenses preceded by a 
bond in the sum of $15,000. The Act is unique, extremely 
limited in its subject matter and prohibitive to such an extent 
that the surety companies have refused to furnish the bonds 
required. 

Maine 

requires since 1914 a registration of salesmen and dealers in 
securities. State licenses issue upon the usual showing as to 
the responsibility of the companies issuing the securities. Its 
provisions are moderate and fair. 

Maryland's 

Statutes are confined to insurance companies. 

The Massachusetts Act 

of 1904 seems to be limited to corporations selling securities on 
the partial payment plan. The Act of 1911 is a penal Statute 
against officers of mining corporations making false statements 
and prohibiting advertisements without filing proof of financial 
condition. This legislation is one of the few Blue Sky Laws 
which distinctly recognizes the right of the interested party to 
his day in Court. 

The Michigan 

law is referred to under Ohio. Copies of oil, gas and mining 
leases and their assignments are required to be filed. 

The Minnesota Act 

of 1917 as amended in 1919 leaves the enforcement of the law 
to the State Securities Commission. 

Their report for 1918 contains a full exposition of the intent 
and scope of Blue Sky Laws and the practice under the same. 
The Acts are minute in detail. See Ohio. 



816 MORRISON'S OIL RIGHTS 

The Mississippi 

Act of 1916 requires permits to dealers with the usual precau- 
tions to show the solvency of the companies offering securities 
and limitation upon the Commissions allowed to dealers. 

A Missouri Act of 1893, 

limited to sales under the installment plan, was construed in 
State' v. Stephens, 136 Mo. 537 and Morrill v. Am. Reserve 
Bond Co., 151 Fed. 305. Its Act of 1913 is an Investment 
Company Statute giving Supervision to the Bank Commissioner. 

Montana's Act of 1913 

creates the office of Investment Commissioner and requires a 
license to dealers with the usual precautionary requirements to 
assure solvency. 

In a case arising under the Statute relief was refused to a 
complaining company on the ground that on its face it was a 
corporation mtended to defraud. National Merc. Co. v. Keat- 
ing, 218 Fed. 477. 

Nebraska 

in 1919 created a State Trade Commission having general con- 
trol of the subject. The old Act of 1903 had been held valid in 
State v. Trout, 72 Neb. 497, on the question of the general pow- 
er of the State to regulate and the grant of judicial power to 
the banking board. 

New Hampshire. 

The scope of the New Hampshire Act of 1917 chap. 202 is 
expressed in its title : "An Act to protect the public against the 
salo of worthless securities." It requires the usual conditions as 
to reports and statements. 

New Jersey 

has no Blue Sky Law, barring a penal Statute against publiea- 



BLUE SKY LAWS 817 

tion of fake advertisements and circulars in re the sale of securi- 
ties. Acts of 1913, chap. 318. 

The New York Statutes 

seem to be confined to insurance and investment companies es- 
pecially in connection with the banking business, and cannot 
be properly classed as a general Blue Sky Law. 

North Carolina 

requires a license to brokers and has a concise Blue Sky Law. 
A conviction for failure to take out license under the Act was 
sustained in State v. Agey, 171 N. C. 831, the opinion contain- 
ing a judicial defense of the power of the State to enact such 

Statutes. 

North Dakota 

has a full Statute passed in 1915 similar to the Ohio law. 

Ohio. 

As the Blue Sky Code of Ohio is possibly the most complete 
and as the other States practically follow their formula we 
state its procedure below. 

The Department of Securities is created as a special State de- 
partment, its executive officer being the Commissioner of Securi- 
ties. 

This Department furnishes printed questionaires covering all 
details which lead up to the conclusion of value or want of value. 

It was passed in 1913 by a referendum vote. In 1914, after 
the Michigan law had been held unconstitutional by a Federal 
Court, the Act was amended with further amendments in 1915 
and 1917. In 1917 its enforcement was placed under the de- 
partment of securities. 

Dealers in stock or securities must procure license. An appli- 
cation for such license must be filed giving all details of the 
dealers address and plan of operations with references to be 
investigated by the commissioner; a stipulation for service on 
M. O. R— 52. 



818 MORRISON'S OIL RIGHTS 

the Sheriff in case of suit brought against him; publication of 
the application; annual fee of $50 and several minor fees for 
filings. 

The Commissioner is empowered to revoke a license without 
a hearing but the dealer whose license has been revoked may 
apply to the Court for a review on which the burden of proof is 
on the dealer to prove his innocence. 

The dealer must file detailed account of the securities in- 
tended to be offered to the public; and copies of all advertise- 
ments and circulars. 

Where the securities are founded on real estate the Commis- 
sioner is allowed to make an examination of it. 

The information imparted to the commissioner "shall not be 
disclosed by him except when lawfully required in a judicial 
proceeding." Sec. 14. Such promise of the State, if such it 
may be called, depends for its keeping on honor alone and is 
wholly perfunctory. 

Oregon. 

The Acts of this State were passed in 191$ (chap. 341) and 
1915 (chap. 324). They cover practically the same ground and 
demand the same conditions as Ohio. 

Pennsylvania. 

The Pennsylvania Act of 1917 P. L. 804, seems to be confined 
to Insurance Companies. 

Rhode Island 

by Act of 1910 requires a preliminary statement to be filed with 
the Secretary of State showing the financial condition of the 
company, with an annual report. 

It provides for examination of the financial state of the com- 
pany by the bank examiner and if his report indicate unsound- 
ness, suggests judicial proceedings to prevent further sales of 
stocks or bonds, a provision which is in admirable contrast to 
the requirements of other States which condemn on ex parte 
inspection without hearing or process of law. 



BLUE SKY LAWS 819 



South Carolina. 



The Act of 1915 concisely requires statements and reports and 
registration similar to these of States with more extended Codes. 

South Dakota. 

The Statutes of this State are similar to and were passed up- 
on by the same cases which upheld the Ohio and Michigan Acts. 

Tennessee. 

The Tennessee Act of 1913, chap. 31, extra session, is concise 
and not very clear, apparently confined to corporations and as- 
sociations, demanding' the usual proofs of solvency, waiver of 
personal service, and annual reports; also a unique section re- 
quiring the company to strike a balance every month which 
would be almost useless and often impracticable. The penalties 
are unusually severe. 

Texas 

has a series of Acts amounting to a full Code upon the subject, 
requiring statements, permits and reports, demanding particu- 
larly in the case of oil, gas and mining companies, proof of the 
value of the lands, empowering the commissioner to employ 
experts to determine such value. 

A full set of forms are printed and in the application for 
permit to sell stock a detailed list of interrogatories must be 
answered. 

These Statutes are framed on the same general principle as 
those of Ohio. 

Utah. 

The Utah Act was passed in 1919. It creates a State Securi- 
ties Commission and requires registration and licenses with 
$5,000 bond from each dealer. The most trifling violation of 
the Act is made a felony with civil damages for any sale made 
contrary to the Act without the proof of fraud. 

The commissioner is given judicial power with the right to 



820 MORRISON'S OIL RIGHTS 

revoke licenses before hearing and no provision for appeal to 
the Courts. 

Vermont, 

by the Act of 1912 as amended in 1917, requires bond to be 
filed with the bank commissioner with the usual statements and 
waiver of process. 

It contains a unique provision allowing revocation papers to 
be issued by the Attorney General who thereupon applies to the 
chancellor for a receiver and to wind up the corporation. 

Virginia. 

The enforcement of the Act is devolved upon the State Cor- 
poration Commission which requires the usual statements and 
reports with a clause compelling citizens to testify against them- 
selves with the promise (which the State has no right to make) 
that they shall not be prosecuted. The Statute further violates 
the constitution in making the findings of the Commission prima 
facie evidence in criminal cases. 

West Virginia. 

The West Virginia Act of 1915 chap. 18, is confined to what 
it defines as speculative securities. It demands the usual state- 
ments but by its section 15 requires application to the Court for 
the relief demanded against alleged violators of the law. The 
prior act of 1913 had been declared unconstitutional in Bracey 
v. Darst, 218 Fed. 482. 

Wisconsin. 

The Wisconsin Act of 1919, chap. 674, places enforcement of 
the Blue Sky Law with the Railroad Commission. It is framed 
substantially upon the Ohio law. 

Wyoming. 

The Act of 1919 after the usual definition of speculative se- 
curities places the enforcement of the law with the State exam- 



BLUE SKY LAWS 821 

iner being one of the few Acts on this subject matter which 
provide for full relief by judicial proceedings where the find- 
ings of the State examiner are contested. 

A compilation of the Blue Sky Laws of the several States 
known as Elliot's Blue Sky Laws was published in 1919, well 
edited and thoroughly annotated. 

The whole subject, to recapitulate, is one where the object 
intended is salutary, the necessity for the legislation apparent 
and the only objection to it from the standpoint of the attorney 
is the general tendency of such Statutes to infringe on constitu- 
tional guaranties. We believe that the destruction of any of the 
fundamental clauses of Magna Charta is a greater evil than any 
supposed benefit based on the maxim that good ends justify bad 
means. Jackson, ex parte, 263 Fed. 110. 



CHAPTER 86. 

ALASKA COAL. 

Alaska is excepted from the terms of the Leasing Act of 1920 
and its coal lands are governed by the Act of 1914 and the 
regulations under the same. 

Alaska is of course the only Continental Territory and its 
distance, its extent and its climate, render its conditions so dif- 
ferent as to justify special Legislation but the regulations treat 
this wild land with a severity of detail framed on the leasing 
policy of largely developed fields and in the investment in 
Alaska Coal lands legal counsel will be constantly required. 

We print the entire Act and regulations without further 
comment. 

Title. 

An Act to provide for the leasing of coal lands in the territory 
of Alaska, and for other purposes. Approved October 20, 1914, 
38 Stat. L. 741 ; Comp. L. 5078a-5078b. 

"Be it enacted by the Senate and House of Representatives of 
the United States of America in Congress assembled. 

Survey of the Territory Directed. Appropriation. 

Section 1. That the Secretary of the Interior be, and hereby 
is, authorized and directed to survey the lands of the United 
States in the Territory of Alaska known to be valuable for their 
deposits of coal, preference to be given first in favor of survey- 
ing lands within those areas commonly known as the Bering- 
River, Matanuska, and Nenana coal fields, and thereafter to such 
areas or coal fields as lie tributary to established settlements or 
existing or proposed rail or water transportation lines: Provid- 
ed, That such surveys shall be executed in accordance with exist- 

822 



ALASKA COAL 823 

ing laws and rules and regulations governing the survey of pub- 
lic lands. There is hereby appropriated, out of any money in 
the Treasury not otherwise 'appropriated, the sum of $100,000 
for the purpose of making the surveys herein provided for, to 
continue available until expended: Provided, That any sur- 
veys heretofore made under the authority or by the approval 
of the Department of the Interior may be adopted and used 
for the purposes of this Act. 

President to Reserve Certain Lands. 

"Sec. 2. That the President of the United States shall desig- 
nate and reserve from use, location, sale, lease, or disposition 
not exceeding five thousand one hundred and twenty acres of 
coal-bearing land in the Bering River field and not exceeding 
seven thousand six hundred and eight}^ acres of coal-bearing 
land in the Matanuska field, and not to exceed one-half of the 
other coal lands in Alaska: Provided, That the coal deposits in 
such reserved areas may be mined under the direction of the 
President when, in his opinion, the mining of such coal in such 
reserved areas, under the direction of the President, becomes 
necessary, by reason of an insufficient supply of coal at a rea- 
sonable price for the requirements of government works, con- 
struction and operation of government railroads, for the Navy, 
for national protection, or for relief from monopoly or oppres- 
sive conditions. 

Coal Lands to Be Blocked. Sale by Lease to Qualified Bid- 
ders. 

"Sec. 3. That the unreserved coal lands and coal deposits shall 
be divided by the Secretary of the Interior into leasing blocks 
or tracts of forty acres each, or multiples thereof, and in such 
form as in the opinion of the Secretary will permit the most 
economical mining of the coal in such blocks, but in no case ex- 
ceeding two thousand five hundred and sixty acres in any one 
leasing block or tract; and thereafter, the Secretary shall offer 
such blocks or tracts and the coal, lignite, and associated min- 
erals therein for leasing, and may award leases thereof through 



S24 MORRISON'S OIL RIGHTS 

advertisement; competitive bidding, or such other methods as 
he may by general regulations adopt, to any person above the 
age of twenty-one years who is a citizen of the United States, 
or to any association of such persons, or to any corporation or 
municipality organized under the laws of the United States or of 
any State or Territory thereof: Provided, That a majority of 
the stock of such corporation shall at all times be owned and 
held by citizens of the United States: And provided further. 
That no railroad or common carrier shall be permitted to take 
or acquire through lease or permit under this Act any coal or 
coal lands in excess of such area, or quantity as may be required 
and used solely for its own use, and such limitation of use shall 
be expressed in all leases or permits issued to railroads or com- 
mon carriers hereunder: And provided further, That any per- 
son, association, or corporation qualified to become a lessee under 
this Act and owning any pending claim under the public-land 
laws to any coal lands in Alaska may, within one year from the 
passage of this Act, enter into an arrangement with. the Secre- 
tary of the Interior by which such claim shall be fully relin- 
quished to the United States; and if in the judgment of the 
Secretary of the Interior, the circumstances connected with such 
claim justify so doing, the moneys paid by the claimant or claim- 
ants to the United States on account of such claim shall, by direc- 
tion of the Secretary of the Interior, be returned and paid over 
to such person, association, or corporation as a consideration 
for such relinquishment. 

"All claims of existing rights to any of such lands in which 
final proof has been submitted and which are now pending be- 
fore the Commissioner of the General Land Office or the Secre- 
tary of the Interior for decision shall be adjudicated within one 
year from the passage of this Act. 

New Leases. 

"Sec. 4. That a person, association, or corporation holding a 
lease of coal lands under this act may, with the approval of the 
Secretary of the Interior and through the same procedure and 
upon the same terms and conditions as in the case of an original 
lease under this Act, secure a further or new lease covering ad- 



ALASKA COAL 825 

ditional lands contiguous to those embraced in the original lease, 
but in no event shall the total area embraced in such original 
and new leases exceed in the aggregate two thousand five hun- 
dred and sixty acres. 

"That upon satisfactory showing by any lessee to the Secre- 
tary of the Interior that all of the workable deposits of coal 
within a tract covered by his or its lease will be exhausted, 
worked out, or removed within three years thereafter, the Sec- 
retary of the Interior may, within his discretion, lease to such 
lessee an additional tract of land or coal deposits, which, includ- 
ing the coal area remaining in the original lease, shall not exceed 
two thousand five hundred and sixty acres, through the same 
procedure and under the same competitive conditions as in case 
of an original lease. 

Consolidation of Leases. 

"Sec. 5. That, subject to the approval of the Secretary of the 
Interior, lessees holding under leases small blocks or areas may 
consolidate their said leases or holdings so as to include in a single 
holding not to exceed two thousand five hundred and sixty acres 
of contiguous lands. 

Maximum Acreage. Second Lease Forbidden. Forfeiture. 

"Sec. 6. That each lease shall be for such leasing block or tract 
of land as may be offered or applied for, not exceeding in area 
two thousand five hundred and sixty acres of land, to be de- 
scribed by the subdivisions of the survey, and no person, asso- 
ciation, or corporation, except as hereinafter provided, shall be 
permitted to take or hold any interest as a stockholder or other- 
wise in more than one such lease under this Act, and any inter- 
est held in violation of this proviso shall be forfeited to the Unit- 
ed States by appropriate proceedings instituted by the Attorney 
General for that purpose in any Court of competent jurisdiction, 
except that any such ownership and interest hereby forbidden 
which may be acquired by descent, will, judgment, or decree 
may be held for two years, and not longer, after its acquisition. 



826 MORRISON'S OIL RIGHTS 

Felony to Hold Second Lease. 

"Sec. 7. That any person who shall purchase, acquire, or 
hold any interest in two or more such leases, except as herein 
provided, or who shall knowingly purchase, acquire, or hold any 
stock in a corporation having an interest in two or more such 
leases, or who shall knowingly sell or transfer to one disquali- 
fied to purchase, or except as in this Act specifically provided, 
disqualified to acquire, any such interest, shall be deemed guilty 
of a felony, and upon conviction shall be punished by imprison- 
ment for not more than three years and by a fine not exceeding 
$1,000: Provided, That any such ownership and interest hereby 
forbidden which may be acquired by descent, will, judgment, 
or decree may be held two years after its acquisition and not 
longer, and in case of minority or other disability such time as 
the Court may decree. 

Corporate Officers Attempting to Hold Second Lease. 

"Sec. 8. That any director trustee, officer, or agent of any cor- 
poration holding any interest in such a lease who shall, on be- 
half of such corporation, act in the purchase of any interest in 
another lease, or who shall knowingly act on behalf of such cor- 
poration in the sale or transfer of any such interest in any lease 
held by such corporation to any corporation or individual hold- 
ing any interest in any such a lease, except as herein provided, 
shall be guilty of a felony and shall be subject to imprisonment 
for a term of not exceeding three years and a fine of not ex- 
ceeding $1,000. 

Unlawful Trust Combinations. 

"Sec. 8a. If any of the lands or deposits leased under the 
provisions of this Act shall be subleased, trusteed, possessed, or 
controlled by any device permanently, temporarily, directly, in- 
directly, tacitly, or in any manner whatsoever, so that they form 
part of or are in anywise controlled by any combination in the 
form of an unlawful trust, with consent of lessee, or form the 
subject of any contract or conspiracy in restraint of trade in 
the mining or selling of coal, entered into by the lessee, or of any 



ALASKA COAL 827 

holding of such lands by any individual, partnership, associa- 
tion, corporation, or control, in excess of two thousand five hun- 
dred and sixty acres in the Territory of Alaska, the lease there- 
of shall be forfeited, by appropriate Court proceedings. 

Rents and Royalties. Renewals. 

"Sec. 9. That for the privilege of mining and extracting and 
disposing of the coal in the lands covered by his lease the lessee 
shall pay to the United States such royalties as may be specified 
in the lease, which shall not be less than two cents per ton, due 
and payable at the end of each month succeeding that of the ship- 
ment of the coal from the mine, and an annual rental, payable 
at the beginning of each year, on the lands covered by such lease, 
at the rate of twenty-five cents per acre for the first year there- 
after, fifty cents per acre for the second, third, fourth, and fifth 
years, and $1 per acre for each and every year thereafter dur- 
ing the continuance of the lease, except that such rental for 
any year shall be credited against the royalties as they accrue 
for that year. Leases may be for periods of not more than 
fifty years each, subject to renewal, on such terms and condi- 
tions as may be authorized by law at the time of such renewal. 
All net profits from operation of government mines, and all royal- 
ties and rentals under leases as herein provided, shall be de- 
posited in the treasury of the United States in a separate and 
distinct fund to be applied to the reimbursement of the govern- 
ment of the United States on account of any expenditures made 
in the construction of railroads in Alaska, and the excess shall 
be deposited in the fund known as The Alaska Fund, established 
by the Act of Congress of January twenty-seventh, nineteen 
hundred and five, to be expended as provided in said last-men- 
tioned Act. 

Free Coal on Small Tracts. 

"Sec. 10, That in order to provide for the supply of strictly 
local and domestic needs for fuel the Secretary of the Interior 
may, under such rules and regulations as he may prescribe in 
advance, issue to any applicant qualified under section three of 



828 MORRISON'S OIL RIGHTS 

this Act a limited lieense or permit granting the right to pros- 
pect for, mine, and dispose of coal belonging to the United 
States on specified tracts not to exceed ten acres to any one per- 
son or association of persons in any one coal field for a period 
of not exceeding ten years, on snch conditions not inconsistent 
with this Act as in his opinion will safeguard the public inter- 
est, without payment of royalty for the coal mined or for the 
land occupied: Provided, That the acquisition of holding of a 
lease under the preceding sections of this Act shall be no bar to 
the acquisition, holding, or operating under the limited license 
in this section permitted. And the holding of such a license 
shall be no bar to the acquisition or holding of such a lease or 
interest therein. 

Easements. Reserve of Surface. 

"Sec. 11. That any lease, entry, location, occupation, or use 
permitted under this Act shall reserve to ihe Government of the 
United States the right to grant or use such easements in, over, 
through, or upon the land leased, entered, located, occupied, or 
used as may be necessary or appropriate to the working of the 
same or other coal lands by or under authority of the govern- 
ment and for other purposes: Provided, That said Secretary, 
in his discretion, in making any lease under this Act, may re- 
serve to the United States the right to lease, sell, or otherwise 
dispose of the surface of the lands embraced within such lease 
under existing law or laws hereafter enacted in so far as said 
surface is not necessary for use by the lessee in extracting and 
removing the deposits of coal therein. If such reservation is 
made, it shall be so determined before the offering of such lease. 

"That the said Secretary during the life of the lease is author- 
ized to issue such permits for easements herein provided to be 
reserved, and to permit the use of such other public lands in the 
Territory of Alaska as may be necessary for the construction 
and maintenance of coal washeries or other works incident to 
the mining or treatment of coal, which lands may be occupied 
and used jointly or severally by lessees or permittees, as may 
be determined by said Secretary. 



ALASKA COAL 829 

Lease to Express Certain Terms. 

"Sec. 12. That no lease issued under authority of this Act 
shall be assigned or sublet except with the consent of the Secre- 
tary of the Interior. Each lease shall contain provisions for 
the purpose of insuring the exercise of reasonable diligence, skill, 
and care in the operation of said property, and for the safety 
and welfare of the miners and for the prevention of undue waste, 
including a restriction of the workday to not exceeding eight 
hours in any one day for underground workers except in cases 
of emergency; provisions securing the workers complete free- 
dom of purchase, requiring the payment of wages at least twice 
a month in lawful money of the United States, and providing 
proper rules and regulations to secure fair and just weighing or 
measurement of the coal mined by each miner, and such other 
provisions as are needed for the protection of the interests of 
the United States, for the prevention of monopoly, and for the 
safeguarding of the public welfare. 

Possession of Lessee to Be Possession of the U. S. 

"Sec. 13. That the possession of any lessee of the land or 
coal deposits leased under this act for all purposes involving 
adverse claims to the leased property shall be deemed the pos- 
session of the United States, and for such purposes the lessee 
shall occupy the same relation to the property leased as if oper- 
ated directly by the United States. 

Forfeiture by Decree. 

"Sec. 14. That any such lease may be forfeited and canceled 
by appropriate proceeding in a Court of competent jurisdiction 
whenever the lessee fails to comply with any provision of the 
lease or of general regulations promulgated under this Act; and 
the lease may provide for the enforcement of other appropriate 
remedies for breach of specified conditions thereof. 

Saving Clause. 

"Sec. 15. That on and after the approval of this Act no lands 



830 MORRISON'S OIL RIGHTS 

in Alaska containing deposits of coal withdrawn from entry or 
sale shall be disposed of or acquired in any manner except as 
provided in this Act: Provided, That the passage of this Act 
shall not affect any proceeding now pending in the Department 
of the Interior, and any snch proceeding may be carried to a 
final determination in said department notwithstanding the pas- 
sage hereof: Provided further, That no lease shall be made, 
under the provisions hereof, of any land, a claim for which is 
pending in the Department of the Interior at the date of the 
passage of this Act, until and unless such claim is finally dis- 
posed of by the department adversely to the claimant. 

Statements to Be Verified. Forms. Blanks. 

"Sec. 16. That all statements, representations, or reports re- 
quired, unless otherwise specified, by the Secretary of the In- 
terior, under this Act shall be upon oath and in such form and 
upon such blanks as the Secretary of the Interior may require, 
and any person making false oath, representation, or report 
shall be subject to punishment as for perjury. 

Regulations. 

"Sec. 17. That the Secretary of the Interior is authorized to 
prescribe the necessary and proper rules and regulations and 
to do any and all things necessary to carry out and accomplish 
the purposes of this Act. 

Repealing Clause. 

"Sec 18. That all Acts and parts of Acts in conflict herewith 
are hereby repealed." 

PRESIDENTIAL RESERVES. 

As directed by the second section of the above Act the fol- 
lowing lands were reserved to the United States. 

Lands Reserved in Matanuska Field, Seward Base and Meridian. 

(1) T. 19 N, R. 6 E.: N. i NE. i and N. J NW. i sec. 4; 
NE. i NE. i, W. i NE. J and NW. i sec. 5. 



ALASKA COAL 831 

T. 20 N., R. 6 E.: Lot 6 and E. i SE. j sec. 31 ; Lots 4, 5, 6, 
and 7 and SE. J and SW. J sec. 32; Lots 3, 4, 5, and 6, S. J 
SE. J, and SW. J sec. 33, containing 1,446.17 acres. 

(2) T. 20 N., E. 5 E.: NE. J, SE. J, E. J NW. J and E. J 
SW. J sec. 20; NW. J, SW. i, SE. J and S. | NE. J sec. 21; 
SW. J and S. i NW. -j- sec. 22 ; NW. J sec. 27 ; NE. J and NW. 
i sec. 28; E. J NE. J and NW. J NE. J sec. 29, containing 
1,880 acres. 

Lands Reserved in Bering River Field, Copper River Base and 

Meridian. 

(3) T. 16 S., R. 8 E.: Sees. 23 and 24. containing 1,280 acres. 

(4) T. 16 S., R. 8 E. : NE. J, SE. \ and SW. J, sec. 33. 

T. 17 S., R. 8-E.: N. \ NW. \ sec. 3; All of sec. 4; E. \ NE. 
J and E. J SE. J sec. 5; E. \ NE. \ sec. 8; N. \ NW. \ sec. 
9, containing 1,520 acres. 

(5) T. 17 S., R. 7 E.: Lot 3 and SE. \ SE. \ sec. 8; Lots 1 
and 2, SE. J NW. \, SW. i and W. J NE. J sec. 9 ; NW. i NW.J 
sec. 16; SE. i, NE. J, NW. i and W. i S.W. J sec. 17; NE. i, 
SE. £, SE. | NW. i, E. i SW. i and lots 3 and 4 sec. 18, con- 
taining 1,556.98 acres. 

Lands Reserved in Nenana Field, Fairbanks Meridian. 

T. 11 S., R, 7 W., SE. i SE. i sec. 29, All of sec. 32. 

T. 12 S., R. 7 W., S. i NW. J SW. i sec. 4, All of sec. 5, con- 
taining 1,560 acres. Leasing Blocks 2 and 3. 

As the Act required a survey before the lands could be blocked 
or offered for lease, the Bering River and Matanuka fields were 
surveyed and thereafter the following regulations were adopted 
applicable to those fields. May 18, 1916, 45 L. D. 113, 

GENERAL REGULATIONS. 

(1) By authority of the Act of Congress approved October 
20, 1914 (38 Stat. 741), the unreserved surveyed coal lands in 
the Bering River and the Matanuska coal fields, Alaska, have 
been divided into leasing blocks, or tracts, of 40 acres, or mul- 
tiples thereof, and leases of such blocks or tracts, with the privi- 



832 MORRISON'S OIL RIGHTS 

lege of mining and disposing of the coal, lignite, and associated 
minerals therein may be procured from the United States in the 
following manner: 

(2) On request addressed to the Commissioner. of the General 
Land Office at Washington, D. C, a blank application and lease 
will be furnished the applicant; also, those who desire may pro- 
cure from the Superintendent of Documents, Government Print- 
ing Office, Washington, D. C, a folio containing- photolitho- 
graphic copies of the approved plats of the topographic and sub- 
divisional township surveys of the Mantanuska field (13 town- 
ships) for $1, and of the Bering River field (8 townships) for 
75 cents. 

(3) From and after June 1, 1916, for a period of 30 days, 1 
applications for coal-mining leases will be received at the Gen- 
eral Land Office from duly qualified applicants. 

Under this Act the qualifications of such lessees are defined 
as follows : 

(a) Any person above the age of 21 who is a citizen of the 
United States; 

(6) Any association of such persons (that is, citizens of the 
United States over 21 years' of age) ; 

(c) Any corporation or municipality organized under the 
laws of the United States, or of any State or Territory thereof, 
"Provided, That a majority of the stock of such corporation 
shall at all times be owned and held by citizens of the United 
States." 

(4) The total area that may be embraced in one lease is fixed 
at 2,560 acres, which may include one or more contiguous leas- 
ing blocks, or tracts, as shown on the map ; and no person, asso- 
ciation, or corporation is permitted to take or hold any inter- 
est as a stockholder or otherwise in more than one lease under 
this act. 

(5) The application blank calls for information as to the 
name of the applicant, a description of the leasing block or 
blocks desired, amount of capital proposed as an investment un- 
der the lease, time when actual development under the lease will 

I Extended to August 1, 191G, 45 L. D. 150. 



ALASKA COAL 833 

begin, experience in eoal mining, and reference as to financial 
standing. 

(6) The Statute under which these proceedings are author- 
ized provides that the Secretary of the Interior may award leases 
"through advertisement, competitive bidding, or such other 
methods as he may by general regulation adopt," and the pur- 
pose of the applications required herein is to procure such infor- 
mation as will best enable the Secretary to award leases so as 
to procure the best terms on behalf of the United States, and 
the most effective development of the coal deposits of the Terri- 
tory. 

(7) .When the time fixed for filing such applications shall 
have expired all applications then on file will be promptly listed 
and the proposed terms thereunder will be noted. Thereafter 
due publication at the expense of the government for not less 
than once a week for a period of thirty days will follow in at 
least two newspapers of general circulation, one of which shall 
be published in the Territory of Alaska and one in the United 
States proper, of the applications filed, each to be designated by 
a number and not by the name of the applicant, the block or 
blocks applied for, with the announcement that at the expira- 
tion of the period of publication the said applications will be 
iaken up and the proposals therein considered, subject to any 
better terms that may be offered by any other qualified appli- 
cant during the period of publication, or by the first applicant. 
Amendment of Dec. 3, 1917, 46 L. D. 262. 

(8) All applications for a lease, or proposals in connection 
therewith, pending at the expiration of the period of publica- 
tion will be submitted to the Secretary of the Interior in one 
report, with specific recommendations as to the awards that 
should be made or denied under the several applications or pro- 
posals; and thereafter such action will be taken by the Secre- 
tary on the report as may in his discretion seem warranted on 
the showing made in each case, by which he will obtain the 
largest investment proportionate to the acreage of the lease, and 
the earliest actual development of the coal mine on a commer- 
cial basis, reserving the right to modify proposed leasing blocks, 
or tracts, if the economical mining of the coal will better be 

M. 0. R.— .33. 



834 MORRISON'S OIL RIGHTS 

procured thereby, or finally to reject airy or all applications if, 
in his judgment, the interests of the United States so require. 

(9) An actual beneficial expenditure on the ground for min- 
ing development and improvement purposes of $100 for each 
acre included within the lease for which application is made will 
be adopted as the minimum basis upon which the proposed in- 
vestments of the several applicants will be considered and ad- 
judged, with the requirement that not less than one-fifth of the 
proposed investment shall be expended in the development of 
the mine during the first year, and a like sum each succeeding 
year, for the period of four years following the execution of 
the lease; excess investments in any year over such proportion- 
ate amount to be credited on the expenditure called for in the 
year ensuing. A bond, to be executed within 10 days after the 
signature of the lease, in the sum of one-half the amount to be 
expended each year will be required of each lessee conditioned 
upon the expenditure of such sum within said period. 

(10) The procedure prescribed in the foregoing is to procure 
the orderly consideration of all applications or proposals that 
may be submitted in accordance with the foregoing regulations 
and within the period of time therein fixed; but when final ac- 
tion shall have been taken by the department upon the applica- 
tions or proposals thus submitted any qualified applicant may 
thereafter apply for a leasing block or tract, and his applica- 
tion will be received and disposed of in the same manner and 
after like publication as herein provided. 

(11) Lands found to contain coal but not divided into leasing 
blocks may be hereafter divided into such blocks, and the lands 
therein made the subject of a leasing offer, the rights of ad- 
jacent lessees to be given due consideration in any award that 
may be made under such offer. 

PROSPECTING. 

The coal-leasing act makes no provision for the right of an 
intending lessee to enter upon and explore coal fields embraced 
within a lease offer prior to submission of his application for 
a lease. 

Such a right, if existent, would by implication carry with it 



ALASKA COAL 83": 

some protection from the interference of others while engaged 
in such inspection as well as the exclusive benefit of any dis- 
coveries made thereby and amount in effect to a preference 
right based upon discovery; otherwise the right of exploration 
would be an empty privilege. 

The entire scheme of section 3 of the Act which governs the 
manner in which leases shall be awarded goes upon the theory 
that the Government is to offer "known" coal lands for leasing 
without priority of right recognized in either discovery, "open- 
ing a mine," or application, and "awarding leases thereof 
through advertisement, competitive bidding, or such other meth- 
ods as he (the Secretary of the Interior) may by general regu- 
lations adopt." 

All prospective applicants, however, will be accorded every 
opportunity to enter upon, inspect, and explore these coal fields 
at their pleasure in so far as such action may be necessary to 
acquire a thorough knowledge of field conditions, but no posses- 
sory or other right, either as against other prospectors or ap- 
plicants or the United States, shall be acquired thereby. 

USE OF TIMBER. 

The use of timber by the lessee, in addition to that taken from 
the leasehold under the terms of the lease, may be secured by 
him from other lands not embraced in leasing units in accord- 
ance with the regulations that may be prescribed by the Secre- 
tary of the Interior under the act of May 14, 1898 (30 Stat. 
414), and the acts amendatory thereof; or by arrangement with 
the Department of Agriculture, if from a national forest. 

LEASES AND PERMITS AND APPLICATIONS THERE- 
FOR, 

COAL-MINING LEASE. 

Date. Parties. 

This indenture of le^se, entered into, in quintuplicate, 
this days of , A. D., 19 , by and 



836 MORRISON'S OIL RIGHTS 

between the United States of America, acting' in this behalf by 

, Secretary of the Interior, party of the 

first part, hereinafter called the lessor, and 

party of the second part, hereinafter called the lessee, under 
and pursuant to the act of Congress, approved October 20, 1914 
(38 Stat. 741), entitled "An act to provide for the leasing of 
coal lands in the Territory of Alaska, and for other purposes," 
hereinafter called the "coal leasing Act." 

Purposes. Description of Land. Mining- and Surface Rights. 

WITNESSETH 

That the lessor, in consideration of the rents and royalties 
to be paid and the covenants to be observed as hereinafter set 
forth, does hereby grant and lease to the lessee, for the period 
of fifty years from the date hereof, the exclusive right and priv- 
ilege to mine and dispose of all the coal and associated minerals 
in, upon or under the following described tracts of land, situated 

in the Territory of Alaska, to wit : 

containing acres, more or less, together with' the right 

to construct coke ovens, briquetting plants, by-products plants, 
and all such other works as may be necessary and convenient 
for the mining and preparation of coal jmd associated minerals 
for market, the manufacture of coke or other products of coal, 
and to use so much of the surface and the sand, stone, timber 
and water thereon as may reasonably be required in the exer- 
cise of the rights and privileges herein granted, the use of such 
timber to be subject to such regulations as may be prescribed by 
the Secretary of the Interior under the Act approved May 14, 
1898 (30 Stat. 414), and the Acts amendatory thereof. 

Rights Reserved by Lessor. 

ARTICLE I. 

Section 1. The lessor expressly reserves unto itself the right, 
to grant or use such easements in, over, through or upon thp 
land teased, entered, located, occupied, or used as may be neees- 



ALASKA COAL 837 

sary or appropriate to the working- of the same or other coal 
lands by or under authority of the government and for other 
purposes; also the right to vise, lease, or dispose of so much of 
the surface of the said lands as may not be actually needed, or 
occupied by the lessee in the conduct of mining* operations. 

Lease Subject to "Coal Leasing Act." 

ARTICLE II. 

It is expressly understood and agreed, that this lease is 
granted subject in all respects to the conditions, limitations, 
penalties and provisions contained in the "Coal Leasing Act," 
which Act is hereby made a part hereof to the same extent as if 
incorporated herein. 

Mining Rights Limited to Coal and Associated Minerals. 

ARTICLE III. 

It is further expressly understood and agreed that the mining 
rights and privileges leased as aforesaid shall extend to and in- 
clude only coal and associated minerals, as hereinafter defined, 
and that no rights or privileges respecting any other kind or 
character of mineral, or mineral substance whatsoever, are 
granted or intended to be granted by this lease. 

ARTICLE IV. 

The lessee in consideration of the lease of the rights and privi- 
leges aforesaid hereby covenants and agrees as follows : 

Investment. 

Section 1. To invest in actual mining operations upon the 

leasing block included herein, the sum of dollars 

of which sum not less than one-fifth shall be so expended during 
the first year succeeding the execution of this instrument, and 
a like sum each succeeding year for the period of four years; 
to furnish a bond, within ten days after signature of the lease, 



838 MORRISON'S OIL RIGHTS 

in the sum of one-half the amount to be expended each year, 
conditioned upon the expenditure of such sum within said per- 
iod, and submit annually, at the expiration of each year for the 
said period, an itemized statement, as to the amount and char- 
acter of the expenditure during said year. 

Annual Rental. 

Sec. 2. To pay as an annual rental for each acre or part 
thereof covered by this lease, the sum of 25 cents per acre for 
the first year, payment of which amount is hereby acknowledged, 
the sum of 50 cents per acre per year for the second, third, 
fourth, and fifth years, and $1 per acre for the sixth and each 
succeeding year during the life of this lease, all such annual 
payments of rental to be made on the anniversary of the date 
hereof, and to be credited on the first royalties to become due 
hereunder during the year for which said rental was paid. 

Royalty. 

Sec. 3. To pay a royalty of 2 cents on every ton of 2,000 
pounds of coal shipped or removed from the leased lands or 
manufactured into coke, briquets or other products of coal, or 
consumed on the premises, during the first five years succeeding 
the execution of this lease, and 5 cents per ton for the next 
twenty years. Royalties shall be payable at the end of each 
calendar month next succeeding that of the said shipment, re- 
moval, donation, manufacture or consumption. 

Lessee to Keep Record of All Coal Shipped. 

Sec. 4. To accurately weigh all coal shipped or removed from 
the leased premises, sold, or donated to local trade, manufact- 
ured into coke, briquets, or other products of coal, or otherwise 
consumed or utilized, and to accurately enter the weight or 
weights thereof in due form in books to be kept and preserved 
by the lessee for such purpose, together with the car numbers, 
if any, of the coal shipped by rail. 



ALASKA COAL 83 ( J 

Reports to Be Furnished Monthly by Lessee. 

Sec. 5. To furnish in manner and form and at such time 
during each calendar month as the lessor shall prescribe, but 
in no event later than the last day thereof, the following written 
reports covering the month immediately preceding, certified 
under oath by the superintendent at the mine, or by such other 
agent on the property having personal knowledge of the facts 
as may be designated by the lessee for such purpose, to wit: 

A report copied from the books required to be kept at the 
mine under section 4 of this article showing the facts required 
to be entered therein; a report of the number of mine cars of 
mine-run coal hoisted or trammed from each coal bed of each 
separate mine; a report showing the quantity, size, and char- 
acter of *coal shipped, used for power purposes and lease con- 
sumption ; donated to employees, manufactured into coke, bri- 
quets, or other products or by-products of coal; in storage on 
the premises, with the quantity of coal of various sizes added 
thereto and taken therefrom during the month. 

ARTICLE V. 

Periods for Readjustment of Royalty. 

It is mutually understood and agreed that the lessor shall 
have the right to readjust and fix the royalties payable here- 
under at the end of twenty-five years from the date hereof, and 
at the end of fifteen years thereafter, and thereafter at the end 
of each succeeding ten year period during the continuance of 
this lease : Provided, That in any such readjustment the royalt}* 
hxed shall not exceed 5 per cent of the average selling price of 
coal of like character at the mine, per ton of 2,000 pounds in 
the coal field embracing the tracts covered by this lease, as 
shown by the books of the lessees operating in said field during 
a period of five years next preceding such readjustment. 

ARTICLE VI. 

This lease is made subject to the following provisions, which 



840 MORRISON'S OIL RIGHTS 

the lessee accepts and covenants faithfully to perform and ob- 
serve : 

Mining Operations to Be Energetically Prosecuted. Work- 
ings Not to Be Abandoned until Examination Made. 

Section 1. The lessee shall diligently proceed to prospect for, 
develop, and mine the coal in or upon the leased lands; shall 
carry on all mining operations in a good and workmanlike man- 
ner, having due regard to the health and safety of miners and 
other employees; and shall leave no available coal abandoned 
which could be recovered by the most approved methods of 
mining when in the regular course of mining operations the 
time shall arrive for mining such coal. No mine, entry, level, or 
group of rooms or workings shall be permanently abandoned 
and rendered inaccessible, save with the approval of the author- 
ized representative of the lessor. 

Preliminary Plan of Mining to Be Submitted in Advance of 
Operations on a Commercial Scale. 

Sec. 2. And also shall develop and mine the coal in the leased 
lands in accordance with a system to be shown by a preliminary 
plan on a scale of not more than 200 feet to the inch and a writ- 
ten description thereof, which plan and description shall be 
submitted for approval by the authorized representative of the 
lessor. 

Where Two or More Beds of Coal, Pillars in Lower Beds to Be 
Left until Coal in upper Beds Extracted. Exceptions. 
Pillars in Lower Beds to Be Arranged Vertically under 
Pillars in Upper Beds. 

Sec. 8. And also where more than one bed of coal is known to 
exist in the leased lands, shall not draw or'remove the pillars 
in any lower bed, before the available coal in any or all upper 
beds has been mined, unless it shall be decided by the author- 
ized representative of the lessor that the workings in any or 
all of the upper beds will not be seriously injured by the ex- 
traction of the pillar coal in the lower workings. Where min- 



ALASKA COAL 841 

iug operations are being earned on in a bed that lies either 
below or above another bed in which mining- has been or is 
being carried on and in which the pillars have not been pulled, 
and where the vertical distance between the two beds is less 
than fifteen times the thickness of the lower of the two beds, the 
lessee shall, as far as practicable, so arrange the pillars that, 
those in the lower bed shall be vertically beneath those in the 
upper bed. Where practicable, by reason of either commercial 
or mining conditions, the available coal in the upper beds shall 
be exhausted before the coal in the lower beds is mined. 

Fifty-foot Barrier Pillars. Lessee May Be Required to Mine 
Barrier Pillars on Adjacent Lands. 

Sec. 4. And also shall not, without the consent in writing of 
the authorized representative of the lessor first had and ob- 
tained, mine any eoal, or drive any underground working, or 
drill any lateral bore hole within 50 feet of any of the outside 
boundary lines of the leased lands, nor within such greater dis- 
tance of such boundary lines, as the said representative shall 
prescribe for the protection of the property or the safeguard- 
ing of mining operations hereunder; but in the event the coal 
up to the like barrier in adjoining premises shall have been 
'worked out and exhausted, and the water therein shall have 
been lowered below the working level of the operations on the 
same bed on the lands covered by the lease, the lessee hereunder 
hereby agrees, upon the written demand of said representative, 
to mine out and remove all the available coal in such barriers, 
both in the lands covered by this lease and on the adjoining 
premises, whenever same can be mined without hardship to 
the lessee and where the coal-mining rights in such adjoining 
premises are owned by the lessor. 

Limitations of Coal to Be Recovered in Advance Workings 
Under "Room-and-Pillar" System. 

Sec. 5. And also where the "room-and-pillar," or any other 
system of mining is followed which requires advance workings 
in the solid coal, including entries, break-throughs, and rooms, 



842 MORRISON'S OIL RIGHTS 

instead of a system of mining under which all the coal is mined 
out and extracted as the work advances, shall not, without the 
consent in writing of the lessor being first had and obtained, 
mine and remove from such advance workings more than the 
following maximum percentages of the coal area for the speci- 
fied depths of cover, viz: 

Not more than 70 per cent where the cover is 100 feet or over 
but less than 200 feet in depth; not more than 65 per cent 
where the cover is 200 feet or over but less than 300 feet in 
depth; not more than 60 per cent where the cover is 300 feet 
or over but less than 400 feet in depth; not more than 55 per 
cent where the cover is 400 feet or over but less than 500 feet 
in depth ; not more than 50 per cent where the cover is 500 feet 
or over but less than 750 feet in depth; not more than 45 per 
cent where the cover is 750 feet or over but less than 1,000 feet 
in depth; not more than 40 per cent where the cover is 1,000 
feet or over but less than 1,250 feet in depth; not more than 
35 per cent where the cover is 1,250 feet or over but less than 
1,500 feet in depth ; not more than 30 per cent where the cover 
is 1,500 feet or over but less than 1,750 feet in depth ; not more 
than 25 per cent where the cover is 1,750 feet or over but less 
than 2,000 feet in depth; not more than 20 per cent where the 
cover is 2,000 feet or over. 

Definition of Term "Percentage of Area." Pillars to Be Re- 
moved as Rapidly as Possible. Exceptions. 

The said coal areas shall mean an area parallel with the dip 
or raise of the coal bed. The percentages of coal areas specified 
shall mean the percentages of coal to be mined in the areas com- 
prised in the advance workings as compared with the percent- 
ages of coal to be left standing in such workings, and shall not 
be construed to mean the percentage of the total amount of coal 
in any such area of any such bed, where such bed in such area 
is thicker than the height of any such workings, nor shall such 
percentages of areas be held to include the coal extracted from 
the pillars in any such area, panel, or district of the mine, as it 
is the intent of the parties hereto that save as otherwise pro- 
vided in this lease, and except where the retention of pillars 



ALASKA COAL 843 

shall be necessary for the maintenance of main roads or pas- 
sageways or for the protection of the property, all such pillars 
shall be mined and removed as rapidly as proper mining will 
permit. 

Fires in Mine Prohibited. 

Sec. 6. And also shall not, save as hereinafter authorized, 
light, keep, or maintain any fire in any mine or stripping, ex- 
cept as approved by the authorized representative of the lessor, 
or underground in any mine, or in contact with the coal in 
place or in or along the outcrop of any coal bed. Failure to 
take prompt and vigorous steps for the extinguishment of any 
such fire shall be sufficient ground for the entry of the lessor 
and the cancellation of this lease. 

Discovery of Valuable Mineral Substances other than Coal 
to Be Reported. Lessee to Have Free Use of Fire Clay 
and Natural Gas for Lease Purposes. Record of Asso- 
ciated Minerals Mined to Be Kept. 

Sec. 7. And also shall promptly notify the authorized repre- 
sentative of the lessor of the discovery of any valuable mineral 
or mineral substance other than coal in the course of mining 
operations hereunder and shall not mine or remove same unless 
the same is an associated mineral as hereinafter defined: Pro- 
vided, That such quantities of fire clay, shale, or gas from the 
coal measures as may be required by the lessee in the conduct 
of operations hereunder may be removed and used without such 
written permission and without payment of royalty therefor. 
The lessee shall keep careful and accurate record in manner and 
form as may be prescribed by the lessor of all such associated 
minerals mined, used, or carried away, and shall pay such rates 
of royalty thereon as may be fixed by the said lessor, except as 
above provided. 

Mine Map Required to Be Kept at the Mine Office. 

Sec. 8. And also shall keep at the mine office clear, accurate, 
and detailed maps on a scale of 100 feet to the inch, in the 



b44 MORRISON'S OJL RIGHTS 

form of a horizontal projection on tracing cloth, of the work- 
ings in each coal hed in each separate mine on the leased lands, 
a separate map to be made for each such bed, and for the sur- 
face immediately over the underground workings, and to be so 
arranged with reference to a public land corner that the maps 
can be readily superimposed. 

Things Required to Be Shown on Detailed Map of Workings. 

Each inap of the workings in any coal bed shall show the loca- 
tion of all openings connecting such bed with the workings in 
any other bed, or with any adjacent mine, or with the surface; 
the location of all entries, gangways, rooms, or breasts, and any 
other narrow or wide workings, including the outlines of aban- 
doned workings, and record of whtther accessible or inaccessible ; 
also barrier pillars, refuge chambers, stoppings, ventilating 
doors, overcasts, undercasts, regulators, and direction of air 
currents at the time of making map ; location of stationary haul- 
age and hoisting engines; permanent electrical generators, dyna- 
mos, and transformers; indications of trolley roads throughout 
their extent; also fire walls, sumps, and large bodies of stand- 
ing water; position of main pumps and fire pipe lines; t re 
shall also be marked on such maps the elevations above or below 
sea level or approved datum at points not over 200 feet apart 
horizontally, or over 100 feet apart vertically, in all main slopes, 
entries, levels, or headings, together with the thickness of coal 
beds at such intervals, and the elevations at the tops and bottoms 
of all shafts, slopes, and inclines. 

Requirements for Map of Surface over Working. 

The map of the surface immediately over the mine workings 
shall show all prominent topographic features and culture, sec- 
tion and township lines, the elevations above sea level or an 
approved datum, and contours at vertical intervals of 25 feet 
of such topographic features. Such map, together with the 
maps of the underground workings, shall be brought up to date 
not less than once in every six months. 



ALASKA COAL 845 

Things Required to Be Shown on General Property Map to 
Be Kept at Mine Office. 

The lessee shall also make and keep at the mine office, at 
sueh time after the commencement of mining operations as the 
authorized representative of the lessor may direct, a clear and 
accurate general map of the entire leased lands, on a scale of 
400 feet to the inch. Such map shall show all prominent topo- 
graphical features and culture ; the location of the surface areas 
immediately over the mine workings shown on the detailed sur- 
face map hereinbefore required ; township, section, and property 
lines; the location of high-water marks; the outline of coal out- 
crops where known; the outlines of the chief mine workings, 
indicating the workings. in each separate coal bed by distinguish- 
ing marks and the elevations above sea level or an approved 
datum, and contours at vertical intervals of 25 feet of the chief 
topographic features. Such map shall be brought up to date 
not less than once in every six months. 

Prints of Maps to Be Furnished Lessor. 

Blue prints or reproductions in duplicate of the maps required 
as aforesaid shall be furnished the authorized representative of 
the lessor when made, and supplemental' prints or reproductions 
in duplicate furnished on or before January 1 of each succeed- 
ing year, showing the extensions, additions, and changes since 
the last map or supplement was submitted. All mine progress 
maps kept by the lessee shall at all times be subject to exam- 
ination by said representative. 

Abandoned Areas to Be Surveyed and Mapped. 

The lessee whenever any mine, or any workings therein are 
to be abandoned or indefinitely closed, and before same shall 
be abandoned or closed, or allowed to become inaccessible, shall 
make a survey thereof so as to accurately show the entire 
worked-out area or areas, and shall extend the results of such 
surve} 7 on the map or maps of the underground workings hero 
inbefore required, and promptly forward blue prints or repro- 
ductions thereof in duplicate to the said representative. 



846 MORRISON'S OIL RIGHTS 

Maps May Be Made at Lessee's Expense in Case of Failure to 
Furnish. 

If the lessee shall fail to make or furnish any map or exten- 
sion or revision as herein required within 90 days after demand 
therefor shall have been made by the authorized representative 
of the lessor, such representative may employ a competent en- 
gineer to make a survey of the mine, and plat the same as above 
provided, the expense thereof to be paid by the lessee, and in 
the event that the lessee shall fail to make such payment within 
60 days after demand therefor by the authorized representative 
of the lessor, such failure shall constitute a cause of forfeiture 
of this lease. 

Second Exit to Surface to Be Provided, Where More Than 
Ten Men Employed on a Shift. Outlet Through Adjacent 
Mine Sufficient Compliance. 

Sec. 9. And also shall, where more than ten men are employed 
underground on any one shift in any separate mine, provide an 
escapeway or second exit to the surface, which shall be separated 
at the surface from the first exit by not less than 50 feet of 
strata in case of drift, slope, or tunnel workings, or in case of 
vertical shafts, or of inclined shafts having a pitch of more than 
45°, by not less than 200 feet of strata. An escapeway or out- 
let through an adjoining mine shall be regarded as a satisfactory 
compliance with this requirement if kept at all time in proper 
condition for use. If such adjoining mine shall be abandoned 
at any time, or shall cease to operate indefinitely, the lessee 
hereunder shall be. solely responsible for the cost and expense 
of maintaining such outlet, and in the event such outlet shall 
be abandoned or permitted to become unsafe for use, the number 
of men employed on any one shift shall be reduced below ten 
until such time as a second exit or escapeway shall be provided. 

Not More Than Five Men to Be Employed in New Workings 
Unless Second Opening Provided. Exceptions. 

Six:. 10. And also shall not employ more than five men under- 
ground on any one shift in any new working of any mine unless 



ALASKA COAL 847 

such new working shall be so connected with adjacent work- 
ings as to provide two distinct and separate means of escape 
from snch new working: Provided, That with the approval of 
the authorized representative of the lessor, not exceeding ten 
men may be so employed in advance of the making of snch sec- 
ond opening, but in no case shall any rooms, drifts, or slopes be 
opened or worked until such second opening is constructed. 

No Building of Inflammable Material to Be Constructed with- 
in 75 Feet of Any Mine. 

Sec. 11. And also shall not construct or maintain any struc- 
ture of inflammable material within 75 feet of any mine opening ; 
nor within said distance permit any structure of noninflammable 
material to be connected to any other structure by means of any 
structure or erection of inflammable material, or to be connected 
to any structure beyond said distance which shall be constructed 
of inflammable material, except as follows, that is to say: 

Exceptions. 

(a) An open timber framework or headframe of timber may 
be constructed over a shaft, slope, or incline. 

(&) The posts, studs, and rafters of any such structure may 
be of wood if the covering or lining is made of noninflammable 
material, but under no circumstances shall wood flooring be 
used, except in tipple and trestle structures. 

Main Intake and Return Airways to Be Separated by Not Less 
Than 50 Feet of Natural Strata. Pillars to Be Left Stand- 
ing Until Prior to Final Abandonment of Mine. 

Sec. 12. And also, except in a prospect opening, shall sepa- 
rate the main intake and return airways and all workings paral- 
lel to such airways by not less than 50 feet of strata except for 
break-throughs or crosscuts for ventilation or haulage, and shall 
provide for such greater distance between such airways or be- 
tween any such airway and parallel workings as may be re- 
quired in the judgment of the authorized representative of the 
lessor. The lessee agrees that the pillars thus provided for 



848 MORRISON'S OIL RIGHTS 

shall be left standing until in the proper course of mining opera- 
tions the time shall arrive for their removal immediately prior 
to the final abandonment of the workings in that particular coal 
bed. 

Ventilating Fan to Be Provided Where More Than 10 Men 
Employed on Shift. Fan Not to Be Placed in Direct Line 
with Any Mine Entrance. With Written Approval of 
Lessor's Representative Furnace May Be Used for Venti- 
lation under Specified Conditions. 

Sec. 13. And also shall whenever more than ten men arc 
employed underground on any one shift provide a fan or other 
mechanical means for circulating such amount of ventilating 
current as may be required by any law of the United States or 
of the Territory of Alaska now or hereafter enacted or by the 
rules and regulations prescribed by the lessor, such fan or other 
mechanical means and the connection between same and the 
point of the entrance of the air current into the mine to be 
made of noncombustible material; and the lessee shall not set 
same in line with the axis of any mine opening, but shall place 
same at a distance of not less than 15 feet from the projection 
of the nearest side of such opening, and shall provide explosion 
doors of the full area of the air shaft or airway, in direct line 
with any and all such mine openings in order to protect said fan 
or other mechanical means of air circulation in case of a mine 
explosion: Provided, That during such time as the mine is 
being opened up and less than ten men are employed under 
ground on any one shift, and with the written approval of the 
authorized representative of the lessor, a furnace may be used 
for ventilation in a nongaseous mine if the fire box thereof is 
inclosed -by brick, rock, or concrete walls, and a passageway 
around such inclosure at least two feet in width provided : And 
provided further, That if a wooden stack is used in connection 
with such furnace the lessee shall not permit such stack to be in 
contact with any coal bed or with any inflammable shale. 

Slack and Refuse to Be Disposed of so as Not to Become a 
Public or Private Nuisance. 

Sei . 14. And also shall make such provisions for the dis- 



ALASKA COAL 849 

posal of the waste, slack, and refuse of the mine that the same 
shall not be a nuisance, inconvenience, or obstruction to any 
right of way, stream, or other means of transportation or travel, 
or to any private or public lands, or embarass the operation of 
any other mine on the leased lands, or on adjoining lands, or 
in any manner occasion private or public damage, nuisance, or 
inconvenience. All waste containing practically no coal shall 
be deposited separate and apart from waste containing coal and 
in accordance with the directions of the authorized representa- 
tive of the lessor. 

Abandoned Workings to Be Covered or Fenced. 

Sec. 15. And also shall upon abandonment substantially 
fence, fill in, cover, or close all surface openings or workings 
where persons or animals are likely to be injured by falling 
therein, or endangered by accumulations of gas, except as the 
lessor shall otherwise direct; and shall maintain all such fenc- 
ing or covering in a secure condition during the term hereof. 

Operations Subject to Inspection of Lessor's Representatives. 
Lessee to Furnish All Necessary Assistance. 

Sec. 16. And also expressly agrees that all mining and re- 
lated operations shall be subject to the inspection of authorized 
representatives of the lessor, and that such representatives, with 
all proper and necessary assistants, may at all reasonable times 
enter into and upon the leased lands and survey and examine 
sanVe and all surface and underground improvements, works, 
machinery, equipment, and operations, and further expressly 
agrees to furnish said representatives and assistants all neces- 
sary assistance, conveniences, and facilities in making any such 
survey and examination. 

Lessee to Permit Examination of Books for Purpose of Check- 
ing Royalty Returns. 

Sec. 17. And also shall permit any authorized representative 
of the lessor to examine all books and records pertaining to 
operations under this lease, and to make copies of and extracts 
M. 0. R.— 54. 



850 MORRISON'S OIL RIGHTS 

from any or all of same, if desired. The information so derived 
to be held confidential. 

Lands Leased and Easements Therein May Be Used for Pur- 
poses of Rendering Operations on Adjoining Lands More 
Safe ; such Use to Be Compensated for. 

Sec. 18. And also shall permit the lessor, its lessees, or trans- 
ferees to make and use upon or under the leased lands any 
workings necessary for freeing any other mine from water, 
causing as little damage or interference as possible to or with 
the mine or mining operations of the lessee hereunder. Any 
such use by a lessee or transferee shall be conditioned upon the 
payment to the lessee hereunder of the amount of actual dam- 
ages sustained thereby and adequate compensation for such use. 

Lessee to Keep True and Accurrate Weights or Measurements 
of Coal Mined and Loaded by Miners. Weighman to Take 
Oath for Faithful Discharge of Duties. Miners to Be Per- 
mitted to Employ Checkweighman. Checkweighman to 
Take Oath for Faithful Discharge of His Duties. 

Sec. 19. And also shall accurately weigh or measure in the 
car and truly account for the coal mined and loaded by each 
miner, w T here the miners are paid either by the weight of their 
output or upon the basis of the measurement of the coal in the 
car ; keep a correct record of all coal so weighed or measured ; 
post or display such record daily for the inspection of the 
miners and other interested persons; and require the weighman 
or person appointed to measure the coal in the car where the 
miners are paid upon the basis thereof, before entering upon 
his duties, to make and subscribe to an oath before some per- 
son duly authorized to administer oaths that he will accurately 
weigh or measure and keep true record of the coal so weighed 
or measured and credit same to the miner entitled thereto, such 
affidavit to be kept conspicuous^ posted at the place of weigh- 
ing, if any, but nothing contained herein shall be 'construed to 
prevent the lessee, in case rock and bone is loaded by the miner, 
from estimating or separately weighing, and deducting the 



ALASKA COAL 851 

amount thereof from the weights of coal accredited to such 
miner. The lessee hereby agrees that if a majority of the miners 
employed on the leased lands so desire they shall be permitted 
to employ at their own expense one of their fellow employees 
to see that the coal is properly weighed or measured and that a 
correct account of same is kept, and agrees to afford such person 
every facility to certify the weights and measurements while 
the weighing or measuring is being done: Provided, That the 
lessee shall not be required to so do unless such person, before 
entering upon his duties, shall make and subscribe to an oath be- 
fore some person authorized to administer oaths that he will 
faithfully discharge the duties of his position, such oath to be 
kept conspicuously posted at the place of weighing, if any. 

Wages to Be Paid in Lawful Money. Freedom of Purchase to 
Be Allowed. Eight-hour Work Day Required. 

Sec. 20. And also shall pay all miners and other employees, 
both above and below ground, at least twice each month in law- 
ful money of the United States, and shall permit such miners 
and other employees full and complete freedom of purchase, but 
with a view to increasing safety this provision shall not apply to 
the purchase of explosives, detonators or fuses, and shall not 
require or permit miners or other employees, except in case of 
emergency, to work underground for more than eight consecu- 
tive hours in any one calendar day, not including time for lunch 
or meals, or the time required to reach the usual working place. 

Premises to Be Surrendered in Proper Condition for Continu- 
ance of Mining Operations. 

Sec. 21. And also shall, at the expiration or earlier termina- 
tion of this lease, deliver up to the lessor the lands covered by 
this lease, together with all fixtures, improvements, and appur- 
tenances, save as hereinafter provided, in such a secure and 
proper state that mining operations may be continued imme- 
diately to the full extent and capacity of such mine. 



S52 MORRISON'S OIL RIGHTS 

ARTICLE VII. 

It is further mutually understood and agreed as follows: 

Suspension of Operations for More than Three Months with- 
out Consent to Be Cause of Forfeiture. Upon Application 
Consent for Suspension for a Specified Period May Be 
Obtained. 

Section 1. That the suspension of mining operations by the 
lessee for a longer period than three months without the con- 
sent in writing of the lessor or its authorized representatives 
shall be cause of forfeiture of this lease. If the lessee shall be 
unable to continue the operation of the mine for any cause, not 
due to the fault or negligence of the lessee, he shall be entitled 
to the suspension of operations for such a length of time, and 
upon payment of such minimum royalties, and such other con- 
ditions as may be specified in the order of suspension, but the 
issuance of any such order shall not excuse the payment of any 
rents or royalties due under this lease, or prevent forfeiture for 
failure to pay same, and the acceptance of any such rent or 
royalty shall not waive any other right of the lessor hereunder. 

Lease Not to Be Assigned without Consent of Lessor. 

Sec. 2. That the lessee shall not assign this lease or any inter- 
est therein, nor sublet any portion of the leased premises, or any 
of the rights and privileges herein granted, without the written 
consent of the lessor being first had and obtained. 

Breach of Lease Covenants May Be Waived in Writing. 

Sec 3. That the lessor or its authorized representative may 
by notice in writing waive any breach of the covenants and con- 
ditions contained herein, except such as are required by the 
aforesaid "coal leasing act," but any such waiver shall extend 
only to the particular breach so waived, and shall not limit the 
lights of the lessor with respect to any future breach. No waiver 
not in writing shall be in any way binding upon the lessor. 



ALASKA COAL 853 

Lease May Be Terminated at Any Time upon Payment of 
Rents, etc. Termination Not to Be Effective until Prop- 
erty Examined. 

Sec. 4. That the lessee may terminate this lease at any time 
upon giving' four months' notice in writing to the lessor or its 
authorized representative, and upon payment of all rents, royal- 
ties, and other debts due and payable to the lessor, and upon 
payment of all wages or moneys due and payable to the work- 
men employed by the lessee, but in no case shall such termina 
tion be effective until the lessee shall have made provision for 
the preservation of any mine on the leased lands in accordance 
with the provisions of this lease : Provided, That in such case 
the right of valuation and purchase, accorded the lessor in the 
section next following (5), shall be exercised within said period 
of four months. 

Lessor to Have Privilege of Valuing and Purchasing Equip- 
ment, etc., on Termination of Lease. Lessee May Remove 
Same within Year. 

Sec. 5. That at the expiration or earlier termination of this 
lease all tools, machinery, and equipment, including tracks, rails, 
and pipe placed by the lessee in the mine or on the property, 
shall before removal from normal position, if requested by the 
lessor or its authorized representatives, be valued by three dis- 
interested and competent persons to be chosen in the manner 
hereinafter provided for the appointment of arbitrators, the; 
valuation of these three or of a majority of them to be conclusive 
of the value of any or all of the said property ; and the lessor or 
its agent, licensee, or lessee shall have the right to purchase with- 
in four months thereafter any or all such tools, machinery, 
equipment, or materials at the said valuation, deducting there- 
from all rents, royalties, or other payments at that time due and 
payable by the lessee. If such valuation shall not be requested 
or the purchase shall not be made within said time the lessee 
shall have the privilege of removing same from the premises 
within one year from the expiration o?* termination of this lease, 
provided all debts and moneys specified in section 4 of this arti- 



854 MORRISON'S OIL RIGHTS 

eie shall have been paid. The lessee shall not, and hereby eove- 
nants not to, remove any mine supports, timbers, or props in 
plaee. All buildings and improvements erected upon the leased 
lands shall become a part of the property, and machinery and 
equipment shall not be removed therefrom in such a way as to 
cause any permanent injury to such buildings or improvements. 

Forfeiture of Lease. 

Sec. 6. That if the lessee shall make default in the perform- 
ance or observance of any of the terms, covenants and stipula- 
tions of this lease, and such default shall continue for 60 days 
after service of written notice thereof by the lessor or its au- 
thorized representatives, then . all the rights and privileges of 
the lessee cease and determine, and the lessor may, by appropri- 
ate proceedings, have this lease forfeited and canceled in a court 
of competent jurisdiction. 

A waiver of any particular cause of forfeiture shall not pre- 
vent the cancelation and forfeiture of this lease for any other 
cause of forfeiture or for the same cause occurring at any other 
time. 

Questions Which May Be Submitted to Arbitration. 

Sec. 7. That in case any dispute shall arise between the lessor 
and lessee as to any question of fact, or as to the reasonableness 
of any requirement made by the lessor under the provisions of 
.this lease, in the matter of operation, methods, means, expendi- 
tures, use of easements, compensation for joint occupancy by 
another lessee of a portion of the leased premises, or such other 
questions as are not determined by express statutory provision, 
such questions or disputes shall be settled by arbitration in the 
manner provided for by this section, and the lessor and lessee 
hereby covenant and agree each with the other to promptly 
comply with and carry out the decision or award of each and 
every board of arbitration appointed under this section. 

Manner of Appointing- Arbitrators. Decision of Third Arbi- 
trator to Be Final. 

Questions in dispute to be determined by arbitration here- 



ALASKA COAL &00 

under shall be referred to a board of arbitration consisting of 
three competent persons, one of which persons shall be selected 
by the lessor or its authorized representative, and one by the 
Lessee, and the third by the two thus selected: Provided, That 
the lessor and lessee may agree upon one sole arbitrator or upon 
the third arbitrator. The party desiring such arbitration shall 
give written notice of the same to the other party, stating there- 
in definitely the point or points in dispute, and name the per- 
son selected b} r such party hereto within twenty days after re- 
ceiving such notice to name an arbitrator; and in the event it 
does not do so, the party serving such notice may select the 
second arbitrator and the two thus named shall select the third 
arbitrator. The arbitrators thus chosen shall give to each of 
the parties hereto written notice of the time and place of hearing, 
which hearing shall not be more than thirty days thereafter, and 
at the time and place appointed shall proceed with the hearing 
unless for some good cause, of which the arbitrators or a major- 
iiy of them shall be the judge, it shall be postponed until some 
later day or date within a reasonable time. Both parties hereto 
shall have full opportunity to be heard on any question thus sub- 
mitted, and the written determination of the board of arbitra- 
tion thus constituted or of any two members thereof or, in case 
of the failure of any two members to agree, then the determina- 
tion of the third arbitrator shall be final and conclusive upon 
the parties in reference to the" questions thus submitted. All 
such determinations shall be in writing, and a copy thereof shall 
be delivered to each of such parties. 

New Board to Be Chosen in Event of Failure of Arbitrators 
First Selected to Choose a Third. 

It is further agreed that in the event of the failure of the 
lessor and lessee, or of the two arbitrators selected as aforesaid 
by the parties hereto, within twenty days from notice to them 
of their selection, to agree upon the third arbitrator, then the 
Secretary of the Interior shall appoint such arbitrator. 

The said third arbitrator shall receive not to exceed $15 per 
day as full compensation for his services and for all expenses 
connected therewith, exclusive of transportation charges; but 



S56 MORRISON '8 OIL RIGHTS 

such compensation shall not be in excess of $150 for any arbi- 
tration. The losing party to such arbitration shall be liable for 
the payment of such compensation and transportation expenses 
of such third arbitrator. 

Sec. 8. That any notice in writing as to any matter mentioned 
in this lease, addressed to the lessee and left upon the premises 
with the superintendent, manager, clerk, or other person in 
charge of the mine or of the office, or, in the absence of any such 
person) posted on the door of the office, shall have the same force 
and effect as if served upon the lessee, and fifteen days shall be 
considered a reasonable notice, unless a longer notice be herein 
provided for or be so provided in such notice. 

ARTICLE VIII. 

It is further expressly agreed and declared that the terms 
and phrases hereinafter mentioned shall have the meanings here- 
inafter assigned unless the context shall otherwise require, that 
is to say : 

{a) The phrase "available coal" as used in this lease shall 
mean merchantable coal from any coal bed which, when reached 
in the prosecution of the lessee's operations hereunder, can be 
mined at a reasonable profit by the use of machinery and meth- 
ods which at that time are modern and efficient. 

(b) The term "coal" as used herein shall mean and include 
ali underground workings now or hereafter opened or worked 
for the purpose of mining and removing coal and associated min- 
erals, together with all buildings, machinery, and equipment, 
above and below ground, used in connection with such mining 
operations. 

(c) The term "pit" or "open pit" shall mean and include strip- 
ping operations or any open-air workings. 

(d) The term "coal" as used herein shall mean and include 
anthracite, semianthraCite, semibituminous, bituminous, sub- 
bituminous, lignite, and graphitic coal, lignite, natural coke, 
and such bony coal as is suitable for use as a fuel. 

(e) The term "associated minerals" as used herein shall mean 
and include fire clay, shale, sandstone, and the bedded materials 



ALASKA COAL 857 

of the eeal measures, exclusive of gold-bearing or other metalli- 
ferous deposits. 

(/) The term "lessee" as used herein shall mean and include 
the heirs, executors, administrators, successors, or assigns of the 
lessee hereinbefore specified. 

ARTICLE IX. 

It is further mutually covenanted and agreed that each obli- 
gation hereunder shall extend to and be binding upon, and every 
benefit hereof shall enure to, the heirs, executors, administrators, 
successors, or assigns of the respective parties hereto. 

i 

ARTICLE X. 

It is also further agreed that no member of or delegate to 
Congress or resident commissioner, after his election or ap- 
pointment, or either before or after he has cpialified, and dur- 
ing his continuance in office, and that no officer, agent, or em- 
ployee of the Department of the Interior, shall be admitted to 
any share or part in this lease, or derive any benefit that may 
arise therefrom, and Jhe provisions of section 3741 of the Re- 
vised Statutes of the United States and sections 114, 115, 116 
of the Codification of the Penal Laws of the United States ap- 
proved March 4, 1909 (35 Stat,, 1109) relating to contracts 
enter into and form a part of this lease so far as the same may 
be applicable. 

In witness whereof — 

The United States of America, 

By [l. s.] 

Secretary of the Interior. 

Witnesses: 

^'..'.'.'.'.'.'.'.'.'.'. [L. S.] 



858 MOKIUsoN's OIL BIGHTS 

APPLICATION FOR COAL-MIXIXC LEASE. 

The undersigned, , 

a resident of , 

a Tr , 

(Native born or naturalized; if the latter, furnish certificate.) 

citizen of the United States, over 21 years of age, hereby applies, 
under the provisions of the act of October 20, 1914 (38 Stat., 
741), for a mining lease of the certain leasing blocks, or tracts, 
of coal lands, to wit : Block . . . . , embracing the following speci- 
fied legal subdivisions : 

aggregating .... acres. If I secure said lease, I propose to 

invest not less than dollars in active, productive 

mining operations conducted upon said lease ; the active develop- 
ment will begin not later than , My experience 

in coal-mining operations is as follows : 

I neither own nor hold any interest, either as a stockholder or 
otherwise, in any lease under this act, or in any application for 
such a lease, save and except the application now made; and I 
hereby refer to t 

as to my financial standing. 

If I am awarded a lease, I will supply a satisfactory bond as 
required in section 9 of the regulations. 

My post-office address is 



(Signed) 



Subscribed and sworn to before me, a 

, on this day of 



[seal] 



ALASKA COAL 85 ( J 

COAL-MINING PERMIT. 

REGULATIONS GOVERNING THE ISSUANCE OF PERMITS FOR THE FREE 
USE OF COAL IN THE UNRESERVED PUBLIC LANDS IN ALASKA. 

Section 10 of the act of October 20, 1914 (Public 216), pro- 
vides : 

That in order to provide for the supply of strictly local and 
domestic needs for fuel the Secretary of the Interior may, under 
such rules and regulations as he may prescribe in advance, is- 
sue to any applicant qualified under section three of this act a 
limited license or permit granting the right to prospect for, 
mine, and dispose of coal belonging to the United States on 
specified tracts not to exceed ten acres to any one person or as- 
sociation of persons in any one coal field for a period not ex- 
ceeding ten years, on such conditions not inconsistent with this 
act as in his opinion will safeguard the public interest without 
payment of royalty for the coal mined or for the land occupied : 
Provided, That the acquisition or holding gf a lease under the 
preceding sections of this act shall be no bar to the acquisition, 
holding, or operating under the limited license in this section 
permitted. And the holding of such license shall be no bar to 
the acquisition or holding of such a lease or interest therein. 

Owing to there being no settlements or local industries in or 
adjacent to the Bering or Matanuska coal fields, and the con- 
templated leasing offer of coal lands in said fields, these regula- 
tions and the permits provided for shall not at present apply to 
coal deposits in those fields. 

Qualifications. 

Under the terms of the act, expressed in section 3 thereof, 
only citizens of the United States above the age of 21 years, 
associations of such citizens, corporations, and municipalities 
organized under the laws of the United States or of any State 
or Territory thereof, provided the majority of the stock of such 
corporations shall at all times be owned and held by citizens of 
the United States, are eligible to receive a permit to prospect for 
and mine coal from the unreserved public lands in Alaska. 



StiO MORRISON'S OIL BIGHTS 

Who May Mine Coal for Sale. 

All permittees may mine coal for sale except railroads and 
common carriers, who by the terms of section 3 of the act are 
restricted to the acquirement of only snch an amount of coal as 
may be required and used for their own consumption. 

Duration of Permits. 

Permits will be granted for two years, beginning at date of 
tiling, if filed in person or by attorney, or date of mailing, if 
sent by registered letter, subject to the approval of the Com- 
missioner of the General Land Office, and upon application and 
satisfactory showing as to the necessity therefor, may be ex- 
tended by the commissioner for a longer period, subject to such 
conditions necessary for the protection of the public interest as 
may be imposed prior to or at the time of the extension. Mis- 
representation, carelessness, waste, injury to property, the 
charge of unreasonable prices for coal, or material violation of 
such rules and regulations governing operation as shall have 
been prescribed in advance of the issuance of a permit, will be 
deemed sufficient causa for revocation. 

Limitation of Area. 

The act limits the area to be covered in any one permit to 10 
acres. It is not to be inferred from this, however, that the per- 
mits granted thereunder shall necessarily cover that area. The 
ground covered by a permit must be square in form and should 
be limited to an area reasonably sufficient to supply the quantity 
of coal needed. 

Scope of Permit. 

Permits issued under section 10 of the Act of October 20, 1914, 
grant only a license to prospect for, mine, and remove coal free 
of charge from the unreserved public coal lands in Alaska, and 
do not authorize the mining of any other form of mineral de- 
posit, nor the cutting or removal of timber. 



ALASKA COAL 861 

How to Proceed to Obtain a Permit. 

The application should be duly executed on Form 4 — 020, 
and the same should either be transmitted by registered mail to, 
or filed in person with, the register and receiver of the United 
States land office of the district in which the land is situated. 
Prior to the execution of the application the applicant must have 
gone upon the land, plainly marked the boundaries thereof by 
substantial monuments, and posted a notice setting' forth his in- 
tention of mining coal therefrom. The application must con- 
tain the statement that these requirements have been complied 
with and the description of the land as given in the application 
must correspond with the description as marked on the ground. 
The permit, if granted, should be recorded with the local mining 
district recorder, if the land is situated within an organized min- 
ing district. 

When Coal May Be Mined before Issuance of a Permit. 

In view of the fact that by reason of long distances and limit- 
ed means of transportation many applicants may be unable to 
appear in person at the United States land office to file their ap- 
plications, it has been deemed advisable to allow such applicants 
the privilege of mining coal as soon as their applications have 
been duly executed and sent by registered mail to the proper 
United States Laud Office. Should an application be rejected, 
upon receipt of notice thereof all privileges under this para- 
graph terminate and the applicant must cease mining the coal. 

Action by Register. 

The register will keep a proper record of all applications 
received and all actions taken thereon in a book provided for 
that purpose. If there appear no reason why the application 
should not be allowed, the register will issue a permit on the 
form provided for that purpose. Should any objection appear 
either as to the qualifications of the applicant or applicants, or 
in the substance or sufficiency of the application, the register 
may reject the application or suspend it for correction or sup- 
plemental showing under the usual rules of procedure, subject 
to appeal to the Commissioner of the General Land Office. Up- 



862 MORRISON'S OIL RIGHTS 

on the issuance of a permit the register will promptly forward 
to the Commissioner of the General Land Office, by special let- 
ter, the original application and a copy of the permit, and trans- 
mit copies thereof to the Chief of the Alaskan Field Division, 
and to the local representatives of the United States Bureau of 
Mines, for their information. 

Note. — These regulations are intended merely as a temporary 
arrangement to meet immediate necessities, as authorized by 
section 10 of the act of October 20, 1914, and are not to be con- 
strued as applying to the leasing of public coal lands in Alaska 
provided in other sections of the act. 

APPLICATION FOR COAL-MINING PERMIT. 

' ,191 

The Commissioner of the General Land Office, 

Washington, D. C. 
Sir : The undersigned, 

(Name of applicant.) 

of , hereby appl for a permit to 

(Post-office address.) 

prospect for, mine, and remove coal from the following-de- 
scribed land : 

(Describe the land by legal subdivision if surveyed, and by 
metes and bounds with reference to some permanent natural landmark if un- 
surveyed.) 

containing approximately acres, situated within the 

land district, miles of 

(Direction.) 

Alaska, and in support of this application make the following 
representation as to qualifications to receive a permit : 

(Citizenship 
of applicant or applicants must here be shown. If the applicant Is a municipality 
or corporal ion, it must be shown under what laws it is organized; and if the 
latter, it must also be shown whether a majority of its stock is owned and held 
by citizens <>1* the United States.) 



ALASKA COAL 863 

The applicant further represent that ha not, 

(He. they, or it.) 

within two years last past, applied for or received a permit to 
mine coal under the provisions of section 10 of the act of October 
20, 1914, in the coal field in which the laud described in this 
application is situated, 

(State exceptions hero, if any.) 

and that the coal herein applied for is to be mined for the pur- 
pose of supplying the following demands, for which approxi- 
mately tons are required annually : 

(Hore itemize the 
various nses to which the coal is to he applied, staling the number of tons 
necessary for each use.) 

It is further represented that the boundaries of the tract de- 
scribed in this application have been plainly marked by sub- 
stantial monuments, and that a proper notice describing the 
land and showing the intention of the applicant to apply for a 
free permit to mine coal therefrom has been posted in a con- 
spicuous place upon the land. 

On consideration that a permit be granted, the applicant 
hereby agree: 

1. To exercise reasonable diligence, precaution, and skill in 
the operation of the mine, with a view to the prevention of in- 
jury to workmen, waste of coal, damage to government property, 
and to comply substantially with the instructions and the rules 
and regulations printed on the back of this application. 

2. To charge only such prices for coal sold to others as repre- 
sent a fair return for the labor expended and reasonable earning 
value to which the investment in the enterprise is entitled, with- 
out including any charge for the coal itself. 

3. Not to mine or dispose of, either directly or indirectly, 
any coal from the area covered by said permit for export or any 
purpose other than "strictly local and domestic needs for fuel." 

4. To leave the premises in good condition upon the termina- 
tion of the permit, with all mine props and timbers in the mine 
intact, and with the underground workings free from refuse and 
in condition for continued mining operations. 

Signature of applicant 



864 MORRISON'S OIL RIGHTS 

The foregoing application was signed by 



of , the applicant therein, in the presence 

of the undersigned, who, at request and in 

(His or their.) (His or their.) 

presence and in the presence of each other, have subscribed our 
names as witnesses to the execution thereof. 

Dated this day of , 19 . . , at 

Territory of Alaska. 

Name Residence 

Name Residence 

THE NENANA FIELD. 

After the opening of the Nenana coal field the above printed 
regulations were adopted for that field, subject to the modifica- 
tions noted below. Feb. 13, 1918. 

GENERAL REGULATIONS. 

The regulations governing coal-land leases in the Territory of 
Alaska, approved May 18, 1916 (45 L. D. 113), including the 
forms of application and lease, will govern proceedings here- 
under so far as applicable, with the following modifications: 

1. On request addressed to the Commissioner of the General 
Land Office at Washington, D. C, a blank application and lease 
will be furnished the applicant; also those who desire may pro- 
cure from the superintendent of documents. Government Print- 
ing Office, Washington, D. C, a folio containing photolitho- 
graphic copies of the approved plats of the topographic and sub- 
divisional township surveys of the field for $1. 

2. Applications for coal-mining leases of the lauds will be 
received at the General Land Office from duly qualified appli- 
cants up to and including March 1, 1918 ; and publication of 
these applications will commence March 4, 1918, and continue 
for a period of 30 days, under paragraph 7 of the regulations, 
amended December 3, 1917, to read as follows: 

7. When the time for filing such applications shall have ex- 
pired all applications then on file will be promptly listed and 



ALASKA COAL 865 

the proposed terms thereunder will be noted. Thereafter due 
publication at the expense of the Government for not less than 
once a week for a period of 30 days will follow in at least two 
newspapers of general circulation, one of which shall be pub- 
lished in the Territory of Alaska and one in the United States 
proper, of the applications filed, each to be designated by a num- 
ber and not by the name of the applicant, the block or blocks ap- 
plied for, with the announcement that at the expiration of the 
period of publication the said applications will be taken up and 
the proposals therein considered, subject to any better terms 
than may be offered by any other qualified applicant during the 
period of publication, or by the first applicant. 

In the case of the Alaska Petroleum Coal Co. 45 L. D. 56 
and 65 the old Alaska Coal Acts of 1904 and 1908 are construed. 
M. 0. R.— 55. 



CHAPTER 87. 

STATUTORY LEGISLATION ON PLACER LOCATIONS. 

All forms of placer deposits since the Oil Leasing Act of 1920 
may still be located and recorded except those cnt out by the 
leasing Act to wit : oil, gas, oil shale, coal, phosphates and sodium. 

The federal requirements are that the location certificate 
(usually the recorded title) shall contain. 

1. The name or names of the locators. 

2. The date of the location, and 

3. Such a description by reference to natural object or per- 
manent monument as will identify the claim. R. S. Sec. 2324, 
Comp. L. Sec. 4620. 

The statutory details of location in Alaska and the several 
Mining States, are as follows: 

ALASKA. 

The location of a placer claim in Alaska is governed by the 
Act of Congress of August 1, 1912, 37 Stat. L. 242 (Comp. L. 
sec. 5054-5058) and the territorial Act of 1915 sees. 129A- 
129R. There are several limitations on Alaska locations not 
known elsewhere. An association location is limited to 40 acres. 
Comp. L. sec. 5054. A power of attorney to locate must be ac- 
knowledged and recorded. Sec. 5055. Only two locations can 
be made in one calendar month. Sec. 5056. The length must not 
exceed three times the width. Sec. 5057. Locations in violation 
of the Act are void. Sec. 5058. 

Location Notice. 

Any person qualified under the laws of the United States, 
who discovers upon the public domain within the Territory of 
Alaska, a placer deposit of gold, or other mineral which is snb- 

866 



LEGISLATION ON LOCATION 867 

ject to entry and patent under the mining laws of the United 
States, may locate a mining claim thereon in the following man- 
ner, to wit : 

First — He shall post, or write upon the initial post, stake or 
monument on the claim, a notice of location containing: 

a. The name or number of the claim. 

b. The name of the locator or locators. 

c. The date of discovery and of posting notice on the claim. 

d. The number of feet in length and width of the claim. 
This notice shall be known as the location notice. 

Staking. 

Second. — He shall distinctly mark the location on the ground 
so that its boundaries can be readily traced, by placing at each 
corner or angle thereof substantial stakes, or posts, not less 
than three feet high above the ground and three inches in di- 
ameter, hewed on four sides; or by placing at each corner or, 
angle thereof mounds of earth or rock not less than three feet 
high and three feet in diameter and the stakes, posts or monu- 
ments so used must be marked with the name or number of the 
claim and the designation, by number, of the corner or angle. 
The initial stake or monument shall be one of the corner stakes, 
posts or monuments of the claim located. 

Blazing Line Stakes. 

If the claim is located on ground that is covered wholly or 
in part with brush or trees, such brush or trees shall be cut or 
blazed along the lines of such claim, so as to be readily traced. 

If located in an open country, the boundary lines shall be 
located by placing line stakes or line mounments so as to be 
readily traced from corner to corner of said claim. — Sec. 1, Act 
of April 20, 1915. 

Location Certificate. Record. 

Sec. 2. — Within ninety days after the discovery and posting 
of the notice aforesaid, the locator shall record with the recorder 



MORRISON'S OIL RIGHTS 

of the district wherein such claim is situated, a certificate of 
location. Such certificate shall contain: 

a. The name or number of the claim. 

b. The name of the locator or locators. 

c. The date of discovery and of posting of the location notice. 

d. The number of feet in length and width of claim. 

e. It shall set forth the description with reference to some 
natural object, permanent monument, or well known mining 
claim together with a description of the boundaries thereof so 
far as applied to the numbering of stakes or monuments. 

A failure to record a certificate of location of claim as herein 
provided shall operate as and be deemed abandonment thereof, 
and the ground so located shall be open to relocation ; Provided, 
That if a full compliance with the preceding provisions of this 
act shall have been made before any location by another, such 
compliance shall operate to prevent the abandonment or for- 
feiture of such claim and save the rights of the original locator. 
Sec. 2. Id. 

ARIZONA. 

1. Post notice containing name of the claim, name of locator, 
date of location and number of acres claimed, and description, 
with reference to natural object or permanent monument. 

2. Mark boundaries with post or monument of stones at each 
angle of claim. Post must be four inches (square) by four 
and a half feet long set one foot in the ground and surrounded 
by a mound of stone or earth. "When a mound of stone is used 
it must be at least three feet in height and four feet in diameter 
at the base." 

3. Within sixty days after date of location, record with 
county recorder a copy of the location notice. Rev. Stats. 1913, 
Sec. 4030. 

CALIFORNIA. 

1. Post upon a tree, rock in place, stone, post or monument a 
notice of location containing the name of the claim, name of 
locator or locators, date of location, number of feet or acreage 



LEGISLATION ON LOCATION S6d 

claimed, such a description of the claim by reference to some 
natural object or permanent monument as will identify the claim 
located, and by marking the boundaries so that they may be 
readily traced; Provided, That where the United States survey 
lias been extended over the land embraced in the location, the 
claim may be taken by legal subdivisions and no other references 
than those of said survey shall be required and the boundaries 
of a claim so located and described need not be staked or monu- 
mented. The description by legal subdivisions shall be deemed 
the equivalent of marking. 

2. Within thirty days after posting record a true copy of the 
notice in the office of the county recorder. Act of March 13, 
1909. Civil Code sees. 1426c, 1426d. 

COLORADO. 

The discoverer of a placer claim shall, within thirty days from 
the date of discovery, record his claim in the office of the record- 
er of the county in which said claim is situated, by a location 
certificate, which shall contain: 

First — The name of the claim, designating it as a placer 
claim ; 

Second — The name of the locator; 

Third — The date of location; 

Fourth — The number of acres or feet claimed; and, 

Fifth — A description of the claim, by such reference to nat- 
ural objects or permanent monuments as shall identify the claim. 

Before filing such location certificate the discoverer shall lo- 
cate his claim: 

First — By posting upon such claim a plain sign or notice, con- 
taining the name of the claim, the name of the locator, the date 
of discovery, and the number of acres or feet claimed ; 

Second — By marking the surface boundaries with substantial 
posts, and sunk into the ground, to wit: one at each angle of 
the claim. R. S. sec. 4205, March 12, 1879. 

IDAHO. 

1. Placer claims, as mentioned in section 2329 of the revised 



870 MORRISON'S OIL RIGHTS 

Statutes of the United States, may be located for the purpose 
of mining deposits and precious stones after the discovery of 
such deposits. Rev. Code Sec. 3221. 

Details of Location. 

2. The locator of any placer mining claim located for the 
purpose of mining placer deposits or precious stones must, at 
the time of making the location, place a substantial post or monu- 
ment as is required in the location of quartz claims at each 
corner of the location, and must also post on one of the same a 
notice of location containing the date of the location, the name 
of the locator, the name and dimensions of the claim, the mining 
district (if any) and county in which the same is situated; and 
must also give the distance and direction from said post or 
monument to such natural object or. permanent monument, if 
any such there be, as will fix and describe in the notice itself 
the location of the claim. 

Within fifteen days after making the location, the locator must 
make an excavation upon the claim of not less than one hundred 
cubic feet, for the purpose of prospecting the same. 

Within thirty days after the location, the locator must file for 
record in the office of the recorder of the county, or of the deputy 
recorder of the mining district in which the claim is situated, a 
substantial copy of his notice of location, to which must be at- 
tached an affidavit such as is required in case of quartz claims. 
Rev. Code, sec. 3222. 

Affidavit. 

Sec. 1. At or before the time of presenting a location notice 
for record, whether it be for a quartz or placer claim, one of the. 
locators named in the same must make and subscribe an affidavit 
in writing on or attached to the notice, substantially as follows, 
to wit: 

STATE OF IDAHO, ) 
COUNTY OF J " 

I, , do solemnly swear that I am a citizen of the 



LEGISLATION ON LOCATION 871 

United States of America (or have declared my intentions to 
become such), and that I am acquainted with the mining ground 

described in this notice of location, and herewith called 

ledge, lode or claim; that the ground and claim therein described, 
or any part thereof, has not, to the best of my knowledge and 
belief been located according to the laws of the United States 
and of this State, or if so located, that the same has been aban- 
doned or forfeited by reason of the failure of such former locat- 
ors to comply in respect thereto with the requirements of said 
laws. 

(Signature) . . . . 

Subscribed and sworn to before me this day of 

A. D. 19 

(Signature) 

Rev. Code sec. 3216. 

MONTANA. 

1. Post notice at point of discovery, containing name of the 
claim, name of locator, date of location and number of acres or 
superficial feet claimed. 

2. Within sixty days after posting such notice sink a shaft 
upon the deposit at or near the point of discovery to be known 
as the discovery shaft. It must be 10 feet vertical or deeper if 
necessary to discover the deposit. The cubical contents of the 
shaft must be not less than 150 cubic feet. If the deposit dis- 
covered by the shaft is less than 10 feet, any deficiency in depth 
may be compensated by other excavation to the 150 cubical feet, 
but at least 75 cubical feet must appear at the point of discovery. 

3. Within thirty days after posting, place monument at each 
corner or angle, to wit : 

a. A tree at least eight inches in diameter blazed on four sides. 

b. A post at least four inches square by four and one-half 
feet long, set one foot in the ground, unless solid rock occur at 
less depths, surrounded, in all cases, by mound of earth or stone, 
at least four feet in diameter by two feet high. A squared stump 
of same size and so mounded is the equivalent of a post. 

c. A stone at least six inches square by eighteen inches in 
length, set two-thirds of its length in the ground with a mound 



872 MORRISON'S OIL RIGHTS 

of earth or stone alongside at least four feet in diameter by two 
feet in height, or • 

d. A boulder at least three feet above the natural surface of 
the ground on the upper side. 

The above classes of monuments (a-d) are enumerated as 
prima facie sufficient, but if others are used it shall be a jury 
question whether they sufficiently mark the location so that "its 
boundaries can be readily traced." 

Each monument must be marked with name of claim and de- 
signation of the corner either by number or cardinal point. 

4. Within sixty days after posting, record with county clerk 
certificate of location containing. 

a. The name of the claim. 

b. The name of the locator. 

c. The date of location and such description of the claim with 
reference to some natural object or permanent monument as will 
identify the claim. 

d. The dimensions or area of the claim and the location there- 
on the discovery shaft, lode or tunnel. 

The word "on" in the last paragraph was probably intended to 
read "of" and should mean that the position of the discovery 
point should be identified. 

VERIFICATION. 

STATE OF MONTANA, } 
COUNTY OF SILVER BOW j SS * 

Before me, the subscriber, a notary public in and for said 
county, personally appeared Armour C. Anderson to me person- 
ally known, who, being duly sworn, saith that he is a citizen of 
the United States and discoverer and locator of the Maid of 
Eckley Placer Mining Claim described in the within certificate 
of location subscribed by him; that the claim is staked and lo- 
cated on the ground as in said certificate described, and that the 
location notice was posted at the point of discovery; and that 
the said certificate and all statements therein made are correct 
and true. 
(Jurat) Armour C. Anderson. 



LEGISLATION ON LOCATION 873 

NEVADA. 

1. Post upon a tree, rock in place, stone, post or monument, 
a notice of location containing' the name of the claim, name of 
locator, date of location, and number of feet or acres claimed. 

2. Mark surface boundaries and the location point in the same 
manner and by same means required for lode claims. On sur- 
veyed land when taken by legal subdivision only the location 
point need be marked. 

3. Within ninety days after posting* the notice of location, per- 
form not less than $20 worth of labor upon the claim for the 
development thereof and record with District and County Re- 
corder a certificate which shall state the name of the claim, 
designating it as a placer claim; name of the locator; date of 
location ; number of feet or acres claimed and description of the 
elaim with regard to some natural object or permanent monu- 
ment so as to identify the claim and the kind and amount of 
location work done and the place on the claim where said work 
was done. 

The marking of the surface boundaries and location point the 
same as "required for lode claims" requires a reference to section 
2423 of the Revised Laws of 1912. The section is uselessly mi- 
nute and complicated. We print the whole section because it 
cannot be intelligibly shortened. 

"The locator of the lode mining claim must sink a discovery 
shaft upon the claim located four feet by six feet to the depth 
of at least ten feet from the lowest part of the rim of such shaft 
at the surface, or deeper, if necessary to show by such work a 
lode deposit of mineral in place; a cut or cross-cut or tunnel 
which cuts the lode at a depth of ten feet or an open cut along 
the said ledge or lode, equivalent in size to a shaft four feet by 
six feet by ten feet deep, is equivalent to a discovery shaft. The 
locator must define the boundaries of his claim by removing the 
top of a tree (having a diameter of not less than four inches) not 
less than three feet above the ground, and blazing and marking 
the same, or by a rock in place, capping such rock with smaller 
stones, such rock and stones to have a height of not less than 
three feet, or by setting a post or stone, one at each corner and 
one at the center of each side-line. When a post is used, it must 



874 MORRISON'S OIL RIGHTS 

be at least four inches in diameter by four and one-half feet in 
length set one foot in the ground. When it is practically impos- 
sible, on account of bedrock or precipitous ground, to sink such 
posts, they may be placed in a mound of earth or stones, or where 
the proper placing of such posts or other monuments is imprac- 
ticable or dangerous to life or limb, it shall be lawful to place 
such posts or monuments at the nearest point properly marked 
to designate its right place. When a stone is used (not a rock 
in place) it must be not less than six inches in diameter and 
eighteen inches in length set two-thirds of its length in the top 
of a mound of earth or stone, four feet in diameter and two and 
one-half feet in height. All trees, posts or rocks used as monu- 
ments, when not four feet in diameter at the base, shall be sur- 
rounded by a mound of earth or stone four feet in diameter by 
two feet in height, which trees, posts, stones or rock mounments 
must be so marked as to designate the corners of the claim lo- 
cated; provided, however, that the locator of a mining claim 
shall within twenty days from the date of posting the notice of 
location, define the boundaries of said claim by placing at each 
corner and at the center of each sideline one of the hereinbefore 
described monuments, and shall within ninety days of the date 
of posting said location notice perform the location work herein- 
before prescribed." Rev. Laws, 1912, sec. 2423. 

Several decisions have attempted to construe these Nevada 
Location Statutes, relieving to some extent locators who have 
failed to comply with their intricate requirements. Zerres v. 
Vanina, 134 Fed. 610; Ford v. Campbell, 29 Nev. 578, 92 Pac. 
206 r Indiana Go. v. Gold Hills Co. 35 Nev. 158, 126 Pac. 965 ; 
Wailes v. Davies, 158 Fed. 667. 

NEW MEXICO. 

(Act of March 17, 1909) 

The locator at the time of making any location of any placer 
mining claim shall cause a notice of such location to be placed 
at a designated corner of the claim stating the name of the claim, 
the purpose and the kind of material for which such claim is 
located, and the name of the locator. If on surveyed land such 



LEGISLATION ON LOCATION 875 

notice shall contain a description by its legal subdivisions ; on 
unsurveyed lands, a description by metes and bounds with refer- 
ence to some known object or monument. 

Each corner, whether on surveyed or unsurveyed lands shall 
be marked by a wooden post at least four feet high, securely set 
in the ground or by a substantial stone monument. 

A duplicate of such location notice shall be filed and recorded 
in the office of the Probate Clerk within ninety days after notice 
posted. 

There must be a previous discovery except that oil and gas 
claimants shall have to the end of the calendar year to make dis- 
covery and their possession in the meantime is to be protected. 

WASHINGTON. 

Location Notice. Staking. 

The discoverer of placers or other forms of deposits subject 
to location and appropriation under mining laws applicable to 
placers shall locate his claim in the following manner: 

First — He must immediately post in a conspicuous place at 
the point of discovery thereon, a notice or certificate of loca- 
tion thereof, containing (a) the name of the claim; (b) the 
name of the locator or locators; (c) the date of discovery and 
posting of the notice hereinbefore provided for, which shall be 
considered as the date of the location; (d) a description of the 
claim by reference to legal subdivision of sections, if the location 
is made in conformity with the public surveys; otherwise, a de 
scription with reference to some natural object or permanent 
monuments as will identify the claim; and where such claim is 
located by legal subdivisions of the public surveys, such loca- 
tion shall, notwithstanding that fact, be marked by the locator 
upon the ground the same as other locations. 

Record. Monuments. 

Second — Within thirty days from the date of such discovery 
he must record such notice or certificate of location in the office 
of the auditor of the county in which such discovery is made, 



87 G MORRISON'S OIL RIGHTS 

and so distinctly mark his location on the ground that its boun- 
daries may be readily traced. 

Discovery Work. Oil and Gas Excepted. 

Third — Within sixty days from the date of discovery the dis- 
coverer shall perform labor upon such location or claim in de- 
veloping the same to an amount which shall be equivalent in the 
aggregate to at least ten dollars' worth of such labor for each 
twenty acres or fractional part thereof contained in such loca- 
tion or claim; Provided, however, that nothing in this subdivi- 
sion shall be held to apply to lands located under the laws of the 
United States as placer claims for the purpose of the develop- 
ment of petroleum and natural gas and other natural oil pro- 
ducts. 

Affidavit of Performance. 

Fourth — Such locator shall upon the performance of such 
labor, file with the auditor of the county an affidavit showing 
such performance and generally the nature and kind of work so 
done. Rem. & Bal. Code sec. 7367. 



WYOMING. 



Location Certificate. 



Hereafter the discoverer of any placer claim shall, within 
ninety days after the date of discovery, cause such claim to be 
recorded in the office of the county clerk and exofficio register 
of deeds of the county within which such claim may exist, by 
filing therein a location certificate, which shall contain the fol- 
lowing : 

First — The name of the claim, designating it as a placer claim. 

Second — The name or names of the locator or locators there- 
of. 

Third. — The date of location. 

Fourth — The number of feet or acres thus claimed 

Fifth — A description of the claim by such designation of 



LEGISLATION ON LOCATION 877 

natural or fixed objects as shall identify the claim beyond ques- 
tion. 

Location Notice and Staking. 

Before filing such location certificate, the discoverer shall 
locate his claim: First — by securely fixing upon such claim a 
notice in plain, painted, printed, or written letters containing 
the name of the claim, the name of the locator or locators, the 
date of the discovery, and the number of feet or acres claimed. 

Second — By designating the surface boundaries by substan- 
tial posts or stone monuments at each corner of the claim. Comp. 
St. sec. 3474. 

There seem to be no specific statutes regulating the location 
of placer claims in Oklahoma, Oregon, North or South Dakota. 

If there are -district rules (which would be very rare) they 
would control. A claim, located by notice and location certif- 
icate complying with the federal requirements above stated, 
would make a sufficient possessory title. 

The instructions printed in Walton v. Wild Goose Co. 123 Fed. 
209, 60 C. C. A. 155, 22 M. R. 688, set forth what makes a valid 
placer location in the absence of statutory regulations. 



CHAPTER 88. 

APPLICATION FOR PLACER PATENT. 

"Where a valid claim existed prior to the date of the passage 
of the Oil Act, February 25, 1920, and has been maintained 
in compliance with the laws under which such claim was in- 
itiated or originally located, a patent may be secured for it 
under the laws in force at the time of the location. See page 
866. 

The following forms are intended to apply to an application 
for patent for a placer claim upon surveyed lands. The pro- 
cedure for application upon unsurveyed lands is given in full 
in the 15th edition of the Mining Rights. 

Government Subdivisions. 

When the application is for one or more exact quarter sec- 
tions or government subdivisions the application does not go 
through the office of the Surveyor General as in case of lode 
claims, or placers not upon surveyed lands, but the application 
must be made in the local Land Office without any proceedings 
whatever in the Surveyor General's office. 

First Set of Papers. 

The first paper to be used is the Notice of Application for 
TJ. S. Patent, of which four copies should be made, one for post- 
ing on the placer claim, one to be attached to the proof of post- 
ing, one for publication in a local newspaper and one for posting 
in the Land Office. 

A. NOTICE OF APPLICATION FOR U. S. PATENT 

U. S. Land Office, Glenwood Springs, Colo. 

October 20, 1920. 

Notice is hereby given that in pursuance of an Act of Congress 

878 



PLACER PATENT APPLICATION 879 

approved May 10, 1872 and the amendments thereto, J. C. Hardi- 
son, whose Post Office address is De Beqne, Colorado, has made 
application for patent for the Monarch Placer Mining Claim 
bearing oil shale, and situate in Mt. Logan Mining District, 
County of Garfield, State of Colorado, and described as follows 
to- wit : The Southeast Quarter of section 24, Township 7 South, 
Range 98, West of the 6th. Principal Meridian. 

Names of adjoining claims unknown. 

Date of posting this notice on claim October 20, 1920. 

J. C. Hardison. 
Witnesses. 
J. C. Carter. 
A. B. Harvey. 

One of the above notices should be at once posted on the placer 
claim in some conspicuous place in the presence of two persons, 
who attach their signatures to the notice posted. 

The second paper to be prepared is; 

B. PROOF OF POSTING NOTICE ON CLAIM 

STATE OF COLORADO, [ 
COUNTY OF GARFIELD, j SS * 

J. C. Carter and A. B. Harvey, each for himself and not one 
for the other, deposes and says that he is a citizen of the United 
States over the age of twenty-one years and was present on the 
20th day of October, 1920 when a notice of the intention of J. C. 
Hardison to apply for a patent from the United States for the 
Monarch Placer Mining Claim was posted in a conspicuous place 
upon said mining claim to-wit: on a post at the discovery cut 
on said mining claim where the same could be easily seen and 
examined. A copy of the notice so posted upon said claim is 
herewith attached and made a part of this affidavit. 

J. C. Carter. 
A. B. Harvey. 

Subscribed and sworn to before me this 22d. day of October, 
1920 and I hereby certify that I consider the above deponents 
credible and reliable witnesses, and that the foregoing affidavit 



880 MORRISON'S OIL RIGHTS 

and the attached notice were read by each of them before their 
signatures were affixed thereto, and the oath made by them. 
My commission expires April 17, 1921. 

( Seal) . George E dinger. 

Notary Public. 

To this form B, Proof of Posting Notice on the Claim, should 
be attached an exact copy of form A, the Notice of Application 
for U. S. Patent. 

Conspicuous Posting. 

Care should be taken to post the notice in a conspicuous place. 
Attempts to post the notice but at the same time to fail to give 
it publicity, such as inclosing it in an oilcloth envelope to pro- 
tect it from the weather, or placing it in a box on the ground 
among large boulders has been held by the department to be a 
posting, not in a conspicuous place. 

Third and Fourth Copy of Notice — Exactness. 

The third copy of Notice B should be an exact copy of the 
notice that is posted except that it is not signed by the witnesses. 
This third copy is to be posted on the Land Office Bulletin and 
remains there during the sixty days' period of publication and 
posting on the claim. 

The fourth copy of notice B should also be an exact copy of the 
notice posted except that it is not signed by the applicant nor by 
the witnesses, but, when sent to the Land Office, is signed by 
the Register, the application number given to it and it is re- 
turned to the claimant or his attorney or forwarded by the Reg- 
ister direct to the printer for publication in the newspaper. 

The next paper to be prepared is the 

C. APPLICATION FOR PATENT 

STATE OF COLORADO, ) 
COUNTY OF GARFIELD. T 

Application for Patent for the Monarch Placer Mining Claim. 

To the Register and Receiver of the U. S. Land Office at Glen- 
wood Springs, Colorado; 



PLACER PATENT APPLICATION 881 

J. C. Hardison, whose Post Office address is De Beque, Colo- 
rado, being duly sworn according- to law deposes and says that 
in virtue of and in compliance with the mining rules, regula- 
tions and customs, by himself and his grantors, he, the applicant 
for patent herein, has become the owner and is in the actual, 
quiet and undisturbed possession of the Monarch Placer Mining 
Claim situate in Mt. Logan Mining District, County of Garfield 
and State of Colorado, and being more particularly described 
as the Southeast Quarter of section 24, Township 7 South, Range 
98, West of the 6th Principal Meridian, and that a notice of said 
application is now posted conspicuously upon said claim and a 
copy of the same is herewith filed. 

Deponent further says that the facts relative to his right of 
possession to said mining claim, are substantially as follows, to- 
wit: 

That said claim was located on the 20th day of October, 1915 
by James A. Allen, who located the same as a placer mining 
claim in full compliance with all local rules and regulations, the 
laws of the State of Colorado and of the United States relating 
to mining claims. 

That said discoverer and locator conveyed all his interest in 
said claim to this applicant, who thereupon took possession and 
is the sole present owner, which will more fully appear by refer- 
ence to the copy of the original record of location and the ab- 
stract of title herewith filed. 

That the value of the labor done and improvements made upon 
or for the benefit of said claim by this applicant and his grant- 
or exceeds the sum of $500; that said improvements consist of 
an excavation at the foot of the escarpment in which the strata 
of oil shale deposits are exposed ; that said excavation is 10 feet 
wide by 30 feet long and at the breast of the same a lateral, 7 
feet high by 5 feet wide in the clear, is run in an easterly direc- 
tion a distance of 40 feet and another lateral, of the same dimen- 
sions, in a westerly direction a distance of 60 feet ; that the cen- 
ter of said excavation bears South 40° East 500 feet from the 
Southeast corner of said section 24. 

That the land applied for is placer ground containing deposits 
of oil shale not in vein or lode formation; that title is sought 
not to control water courses or to obtain valuable timber but in 
M. O. ft.— 56. 



882 MORRISON'S OIL RIGHTS 

good faith because of the mineral therein; that deposits of oil 
shale in stratum formation exist upon practically all parts of 
said claim and that tests from the oil shale upon said claim have 
produced 60 gallons of oil to the ton of oil shale. 

The soil is a black loam varied in depth except where the oil 
shale is exposed at different points on the surface and upon the 
face of the escarpment which extends throughout the claim, run- 
ning in an easterly and westerly direction. 

There are no streams or springs upon the land and the timber 
consists of a scattering growth of small pine and scrub oak. 

The claim is located about three miles in a westerly direction 
from the town of De Beque in said state. 

There are no salt licks, salt springs or mines, other than the 
claimant's workings, nor mill sites upon this claim. 

In consideration of which facts and in conformity with the 
provisions of chapter 6 of Title 32 of the Revised Statutes of 
the United States and the amendments thereto, application is 
hereby made for and in behalf of said J. C. Hardison for a patent 
from the United States for the said Monarch Placer Mining 
Claim. 

J. C. Hardison. 

Subscribed and sworn to before me this 22nd day of October, 
A. D. 1920 and I hereby certify that the foregoing affidavit was 
read and examined by said J. C. Hardison before his signature 
was affixed thereto and the oath made by him. 

My Commission expires April 17, 1921. 

• 

George E dinger. 
Notary Public. 

What Application Must Show. 

The location being upon surveyed lands, the descriptive re- 
port required to be made by the surveyor in cases of official sur- 
vey of the claims, is dispensed with, and in lieu thereof the state- 
ments of the claimant must supply the requirements of the sur- 
veyor's report, and should show in detail the shafts, cuts, tunnels, 
or other workings claimed as improvements, giving their dimen- 
sions, value, and the course and distance thereof to the nearest 



PLACER PATENT APPLICATION 883 

corner of the public surveys. Rule 60. The detailed require- 
ments are shown in the foregoing form and should be carefully 
followed. 

The next paper to be prepared is D the corroborating affidavit 
of two disinterested witnesses as to the statements made in the 
application concerning the location and value of the improve- 
ments. 

D. CORROBORATING AFFIDAVIT 

STATE OF COLORADO, Jss. 
COUNTY OF GARFIELD. J 

J. C. Carter and A. B. Harvey, each for himself and not one 
for the other being first duly sworn, deposes and says ; that he is 
a citizen of the United States over the age of twenty-one years ; 
that he is well acquainted with the Monarch Placer Mining Claim 
situate in Mt. Logan Mining District, County of Garfield, State 
of Colorado, claimed by J. C. Hardison and described in his ap- 
plication for U. S. Patent therefor; that he has examined the 
work that has been done upon said placer claim and that the 
statements made in said application for patent as to such work 
and improvements is true; that the value of said work exceeds 
the sum of $500. 

That he has read said application for patent as signed by said 
applicant and knows the contents thereof and that the matters 
and things stated in said application are true of his own knowl- 
edge. 

J. C. Carter. 
A. B. Harvey. 

Subscribed and sworn to before me this 22nd day of October, 
A. D. 1920 and I hereby certify that the foregoing affidavit was 
read to the- above named J. C. Carter and A. B. Harvey prior to 
their names being subscribed thereto and that deponents are 
reputable citizens to whom full faith and credit should be given. 

My Commission expires April 17, 1921. 

George Eclinger. 
Notary Public. 



884 MORRISON'S OIL RIGHTS 

The foregoing corroborating affidavit is required by the Regu- 
lations of the Land Office controlling the proceedings on appli- 
cation for patent, particularly when the claim is on surveyed 
land, because in such cases the showing otherwise made in an 
official survey is absent. 

The next paper to be prepared is 

E. PROOF OF CITIZENSHIP 

STATE OF COLORADO, ) 
COUNTY OF GARFIELD. \ 

J. C. Hardison being first duly sworn according to law deposes 
and says; that he is the applicant for patent for the Monarch 
Placer Mining Claim situate in Mt. Logan Mining District, 
County of Garfield, State of Colorado; that he is a native born 

citizen of the United States, born in the County of , 

State of , and is now a resident of De Beque, State 

of Colorado. 

J. C. Hardison. 

Subscribed and sworn to before me this 22nd* day of October, 
A. D. 1920. 

My Commission expires April 17, 1921. 

George E dinger. 
Notary Public. 

Naturalized Citizen. Corporation. 

Where the applicant is not a native born citizen, the proof 
should show when, where and in what Court he took out his 
first papers; if the applicant is a corporation the proof is made 
by a certified copy of the Charter or Articles of Incorporation. 

Newspaper Designated. 

While the foregoing papers are being prepared the applicant 
should request the Register of the local Land Office to designate 
the newspaper in which the fourth copy of A. is to be published, 
and when designated, the applicant should secure from such 
paper the 



PLACER PATENT APPLICATION 885 



F. PUBLISHER S CONTRACT 



I, the undersigned, proprietor and publisher of the Oil Shale 
News, a weekly newspaper published at De Beque, Mesa County, 
State of Colorado, hereby agree to publish a notice dated U. S. 
Land Office, Glenwood Springs, Colorado, October 20, 1920 re- 
quired by Act of Congress approved May 10, 1872, of the in- 
tention of J. C. Hardison to apply for a patent for his claim 
on the Monarch Placer Mining Claim situate in Mt. Logan Min- 
ing District, County of Garfield, State aforesaid, and to hold 
said J. C. Hardison alone responsible for the amount of our bill 
for publishing the same. 

And it is hereby expressly stipulated and agreed that no claim 
shall be made against the government of the United States, or 
its officers or agents, for such publication. 

WITNESS my hand and seal this 22nd day of October, A. D. 
1920. 

A. B. Bush. 
Publisher. 

The newspaper designated by the Register must be a paper 
published nearest the claim; if two papers are published in the 
nearest town, either may be designated and it is the practice of 
the Register in such cases to designate that one which the claim- 
ant may suggest. 

Abstract of Title. 

Pending the preparation of the papers A to F the claimant 
should cause to be prepared an Abstract of Title by the Clerk 
and Recorder of the County in which the claim is located. The 
Department requires that the application shall be accompanied 
by a certified copy of the location notice, and such copy should 
be included in the Abstract, the Recorder's Certificate to the Ab 
stract showing that it contains a true copy of the location cer- 
tificate. 

The Abstract must show title in the applicant on the date that 
the application is filed in the local Land Office. As it is fre- 
quently impracticable to secure the Abstract certified upon the 



886 MORRISON'S OIL RIGHTS 

same date as the application is made it is advisable to file the 
First Set of papers when ready and the Land Office will hold 
the application suspended nntil the Abstract is filed. Or the 
applicant may file his Abstract with the application and there- 
after furnish a supplementary Abstract certified to and including 
the date of filing. However, publication will not be ordered 
until the proper Abstract is filed. Upon filing the Abstract, or 
when publication is ordered, the Register will either deliver to 
the applicant or send direct to the newspaper the copy of A 
signed by the Register which must be published sixty-one days 
in a daily, or nine consecutive times in a weekly paper ; and while 
such notice is being published, a copy also stands posted on the 
claim and one copy is posted on the bulletin at the Land Office. 

Methods of Notice Mandatory. 

Each of these methods of giving notice is mandatory and es- 
sential and care should be taken by the applicant that the copy 
posted on the claim should remain so posted during the entire 
period of publication. 

Lode Claims within Placers. 

In all placer applications it must be shown whether or not 
there are any known veins Or lodes included within the placer, 
and if there are, such fact must be stated in the application and 
notices whether owned by the applicant or others. Where there 
is no known vein or lode that fact must appear by the affidavit 
of two or more witnesses (rule 26) and the affidavit must be 
filed in the Land Office with the first set of papers. 

G. PROOF THAT NO KNOWN VEIN OR LODE EXISTS IN PLACER 

STATE OF COLORADO, ) 
COUNTY OF GARFIELD, p* 

C. 0. Post and Daniel E. Fisher, each of lawful age and resi- 
dent in De Beque, County of Mesa, said State being first duly 
sworn, each for himself and not one for the other, saith, that 
he is a citizen of the United States; that he is well acquainted 
with the Monarch Placer Mining Claim, situate in Mt. Logan 



PLACER PATENT APPLICATION 887 

Alining District, County of Garfield, State of Colorado, claimed 
by J. C. Hardison, applicant for United States Patent therefor ; 
that for many years he has resided near to and is well acquainted 
with the character of said land, having frequently passed over 
the same; that his knowledge of said land is such as to enable 
him to testify understandingly in regard thereto, and that there 
is not, to his knowledge, within the limits thereof, any known 
vein or lode of quartz or other rock in place bearing gold, silver, 
cinnabar, lead, tin or copper upon said claim or any part thereof, 
and further that he has no interest whatever in the said placer 
claim. 

C. 0. Post. 
Daniel E. Fisher. 

Subscribed and sworn to before me this 22nd day of October, 
A. D. 1920, and I hereby certify that the foregoing affidavit was 
read to the above named C. 0. Post and Daniel E. Fisher previ- 
ous to their names being subscribed thereto, and that deponents 
are reputable persons to whom full faith and credit should be 
given. 

My Commission expires April 17, 1921. 

(Seal) George E dinger. 

Notary Public. 

The above set of papers from A to G constitute what is called 
the first set of application papers. 

Second Set or Final Entry Papers. 

If no Adverse Claim is filed in the Land Office by a hostile 
interest on or before the sixtieth day after the date of the first 
newspaper publication, the applicant may then proceed with 
what, is called the Second Set or Final Entry papers, which 
consist of H, Proof that Notice remained posted on Claim dur- 
ing publication period, I, Certificate of Publication, J, Proof of 
sums paid and K, Application to purchase, and after the notice 
has run for its full length of time in the newspaper there should 
be prepared 



888 MORRISON'S OIL RIGHTS 

H. PROOF THAT NOTICE REMAINED POSTED ON CLAIM DURING TIME 

OF PUBLICATION 

STATE OF COLORADO, ) 
COUNTY OF GARFIELD. \ 

J. C. Hardison being first duly sworn according to law deposes 
and says that he is the claimant of the Monarch Placer Mining 
Claim situate in Mt. Logan Mining District, Garfield County, 
State of Colorado, upon which notice of his intention to apply 
for a patent therefor was posted on the 20th day of October, A. 
D. 1920 as fully set forth and described in the affidavit of J. C. 
Carter and A. B. Harvey dated the 22nd day of October, A. D. 
1920, which affidavit was duly filed in the office of the Register' 
at Glenwood Springs in said State ; and that said notice so men- 
tioned and described remained continuously and conspicuously 
posted upon said mining claim from the 20th day of October, 
A. D. 1920 until and including the 27th day of December 1920, 
including the sixty days' period during which notice of said ap- 
plication for patent was published in the newspaper. 

J. C. Hardison. 

Subscribed and sworn to before me this 27th day of December, 
A. D. 1920 and I hereby certify that the foregoing affidavit was 
read to the said J. C. Hardison previous to his name being sub- 
scribed thereto. 

My Commission expires April 17, 1921. 

George E dinger. 
Notary Public. 

Affidavit on Information. 

The Department has ruled that this affidavit of continuous 
posting may be made by the claimant from information derived 
from hearsay. 9 L. D. 503. 

Destruction of Posted Notice. 

If the posted notice has been destroyed pending publication 
the Department requires a new posting and a%iew publication. 



PLACER PATENT APPLICATION 889 

37 L. D. 365; Batterton v. Douglas Company, 20 Ida. 763, 120 
Pac. 827, 38 L.E.A.(N.S.) 1121. 

The next paper of the second set is 

I. CERTIFICATE OF PUBLICATION 

I, A. B. Bush, do hereby certify that I am publisher of the 
Oil Shale News, a weekly newspaper published at De Beque, 
County of Mesa, State of Colorado and that the annexed notice 
was published in said paper once each and every week for nine 
consecutive weeks, the first publication being on the 25th day of 
October, A. D. 1920 and the last publication being on the 27th 
day of December, A. D. 1920. 

A. B. Bush. 

Subscribed and sworn to before me this 27th day of December, 
A. D. 1920. 

My Commission expires, April 17, 1921. 

George E dinger. 
Notary Public. 

To the above certificate the publisher attaches a copy of the 
notice cut from the paper, and generally attaches his receipted 
bill to the certificate, showing that the bill is paid. 

The next paper to be prepared is 

J. PROOF OF SUMS PAID 

STATE OF COLORADO, ) 
COUNTY OP GARFIELD. \ 

J. C. Hardison, having been first duly sworn according to law, 
deposes and says that he is a citizen of the United States, over 
the age of twenty-one years ; that he is the applicant for patent 
to the Monarch Placer Mining Claim, in Mt. Logan Mining Dis- 
trict, Garfield County, State of Colorado; that in the prosecu- 
tion of such application he has paid the following sums of money, 
viz.: 



890 MORRISON'S OIL RIGHTS 

To Register and Receiver for filing application in 

Land Office, $10 00 

To the Oil Shale News, for publishing Notice of 
Application, 24.00 

To the Receiver of the local Land Office, for land .... 400.00 



$434.00 

J. C. Hardison. 

Subscribed and sworn to before me this 28th day of December, 
A. D. 1920. 

My Commission expires April 17, 1921. 

■ ' George E dinger. 

Notary Public. 

These are the official costs only, and other charges incident to 
the application, such as notary's fees, cost of abstract and at- 
torney's fees are not to be included. 

The final paper to be prepared and filed with the second set is, 

K. APPLICATION TO PURCHASE 

To the Register and Receiver, United States Land Office, at 
Glenwood Springs, Colorado; — 

The undersigned, claimant under the provisions of the Revised 
Statutes of the United States, Chapter VI, Title 32, and legisla- 
tion supplemental thereto, hereby applies to purchase that min- 
ing claim known as the Monarch Placer Mining Claim, described 
as follows to-wit: — The Southeast quarter of Section 24, Town- 
ship 7 South, Range 98, West of the 6th Principal Meridian, in 
Mt. Logan Mining District, County of Garfield and State of 
Colorado, embracing one hundred and sixty acres, and hereby 
agrees to pay therefor the sum of Four hundred Dollars, being 
the legal price thereof. 

Dated, Glenwood Springs, Colorado, January 2, 1921. 

J. C. Hardison. 

I Register of the Land Office at Glen- 
wood Springs, Colorado do hereby certify that the aforesaid 
Mining Claim, as applied for above, is subject to entry by the 



PLACER PATENT APPLICATION 891 

above named applicant ; the area of said Mining Claim being one 
hundred and sixty acres, and the legal price thereof Four hun- 
dred Dollars. 
January 2, 1921. 



Register. 

The above Application to Purchase is not required to be veri- 
fied. 

When the foregoing final entry papers, H to K, are filed in the 
land office and the purchase money paid, the Register, if all 
papers are regular, makes his certificate that the fourth copy 
of A, Notice of Application, remained posted in his office during 
the period of publication in the newspaper. 

Final Certificate of Entry. 

Upon approval of all proceedings in the application the Regis- 
ter issued his Final Certificate of Entry of which he delivers to 
the claimant a duplicate which should be kept by the claimant 
until he receives notice from the local land office that patent has 
arrived at such office, as it is necessary that it should be sur- 
rendered to the land office before patent is delivered to the 
claimant. If the certificate should be lost or mislaid, provision 
is made in the land office regulations for the filing of an affidavit 
showing such loss, whereupon, if the affidavit be sufficient, the 
patent is delivered notwithstanding the non-production of the 
Certificate. 

Affidavits— Where and before What Officers Made. 

The Statute, as well as the regulations, requires that all affi- 
davits required to be made by the applicant must be made with- 
in the land district.— R. S. Sec. 2335, 34 L. D. 314, 35 L. D. 455, 
42 L. D. 526. An exception is the affidavit of citizenship which 
by Act of April 26, 1882 may be made anywhere in the United 
States, when the applicant resides outside of the land district. 

They may be made before any disinterested officer authorized 
to administer oaths. But a notary public who has been retained 
as counsel for any interested party cannot act. 34 L. D. 526. 



892 MORRISON'S OIL RIGHTS 

Non-Resident Owner. Power of Attorney. 

It will often happen that an application for patent is to be 
made by a nonresident owner, and in such case, in order to avoid 
the necessity of the owner journeying- to the land district to 
make affidavits, which would require at least two trips, he may 
delegate the power to an agent or attorney-in-fact, which must 
be by a written power to be filed in the land office with the first 
set of papers. 

Power of Attorney to Apply for Patent 

Know All Men By These Presents, That I, Edward D. 
Allen, of the City of Chicago, State of Illinois, a citizen of the 
United States, do hereby constitute and appoint George C. Hart, 
of De Beque, County of Mesa, State of Colorado, my Attorney-in- 
fact for me and in my name to make application for patent of 
the United States, in the proper Land Office, upon the Paraffin 
Placer Mining Claim, situate in Mt. Logan Mining District, 
County of Garfield, State of Colorado, and being the "Northwest 
quarter of Section 10, Township 6 South, Range 97 West of the 
6th Principal Meridian; and to make or cause to be made any 
and all affidavits and papers which may be required in the pros- 
ecution of such application, or to perfect or protect the title 
thereto, and to do all acts and things in and about the premises 
which I myself, if present could do, until patent is finally de- 
livered. 

Also, in case of adverse claim being filed against said applica- 
tion, I authorize my said attorney-in-fact to employ counsel and 
take all measures necessaiy to defend against said adverse claim 
or suit in support thereof, either in the land office or in judicial 
proceedings, and in such judicial proceedings to execute any 
bonds or other papers, and verify all proceedings, to and includ- 
ing appeal or writ of error. 

In Witness Whereof, I have hereunto set my hand and seal 
this third day of February A. D. 1921. 

Edward D. Allen. (Seal) 



PLACER PATENT APPLICATION 893 

STATE OF ILLINOIS) 
COUNTY OF COOK \ ss " 

I, Henry C. Best, a Notary Public in and for said County and 
State do hereby certify that Edward D. Allen, who is person- 
ally known to me to be the same person described in and who 
executed the within Power of Attorney to Apply for Patent, per- 
sonally appeared before me this day and acknowledged that he 
signed, sealed and delivered the said instrument as his free and 
voluntary act and deed for the uses and purposes therein set 
forth. 

Witness my hand and notarial seal this third day of February 
A. D. 1921. 

Henry C. Best, 
Notary Public. 
(seal) 

Mineral Surveyor Disqualified. 

The Land Office regulations (Rule 93) provide that a mineral 
Surveyor will not be allowed to prepare for the claimant the 
papers in support of an application for patent or otherwise per- 
form the duties of an attorney before the land office in connec- 
tion with a mining claim. He should, therefore, not be desig- 
nated as an agent in the power of attorney. 

Application by Corporation. 

A corporation may, of course, execute a power of attorney to 
an agent, but the better procedure is for the company to appoint 
by resolution, some officer to act for the company, a copy of 
which resolution should be certified by the Secretary and filed, 
with the first set of papers, in the Land Office. 

Certified Copy of Resolution of The Grand Valley Oil 
Company Designating Agent to Apply for Patent. 

I, Clyde "W. Turnbull, Secretary of The Grand Valley Oil 
Company, do hereby certify that at a meeting of the Board of 
Directors of said Company held at the office of the Company, in 



894 MORRISON'S OIL RIGHTS ' 

Denver, Colorado, on the 12th day of April, A. D. 1921, at which 
meeting 1 a majority of the Board of Directors, constituting a 
quorum, were present, the following resolution was passed and 
adopted, to-wit: — 

"Resolved, That John G. Kerr, Vice-President of the Com- 
pany be and he is hereby designated and appointed as the officer, 
agent and attorney-in-fact of this company, to make application 
in its behalf for patent of the United States in the Glenwood 
Springs, Colorado Land Office for the Paraffin Placer Mining 
Claim, being the Northwest quarter of Section 10, Township 6 
South, Range 97 West of the 6th Principal Meridian, in Mt. 
Logan Mining District County of Garfield, State of Colorado, 
and to make and sign all affidavits and other papers required in 
the prosecution of said application, and to do any and all things 
necessary to be done in the premises until patent is issued." 

And I further certify that the foregoing is a true and correct 
copy of said resolution as the same appears upon the minute 
book of said company, and that the same has not been changed, 
altered or modified. 

In Witness Whereof, I have hereunto set my hand and af- 
fixed the corporate seal of said Company this 12th day of April 
A. D. 1921. 

Clyde W. Turnbull, 

Secretary. 
(corporate seal) 

Adverse Claim. 

The Federal Statutes, R. S. Sections 2325 and 2326 provide for 
the filing of an adverse claim against an application for patent, 
and the bringing of a suit in a court of competent jurisdiction 
in support of the adverse. 

The adverse claim must be filed during the period of sixty 
days' publication which has been construed to mean on or before 
the sixtieth day after the date of the first newspaper publica- 
tion. 13 L. D. 286. The time for filing the adverse cannot be 
extended. 29 L. D. 467 ; nor can it be withdrawn for amendment, 



PLACER PATENT APPLICATION 895 

but if any defect in it be discovered before the period for filing 
has expired, a new adverse curing the defect may be filed. 

The adverse is to be filed in the local land office where the 
application is made, and the form may be as follows : — 

Adverse Claim 

United States Land Office at Glenwood Springs, Colorado : 

In the matter of the application of J. C. Hardison for a 
United States Patent to the Monarch Placer Mining Claim, sit-' 
uate in Mt. Logan Mining District, County of Garfield, State 
of Colorado. 

To the Register and Receiver of said United States Land 
Office, and to the above named claimant 

Whereas J. C. Hardison did, on the 22d day of October, A. D. 
1920, file in the District Land Office of the United States at 
Glenwood Springs, Colorado, his application for a United States 
Patent for the Monarch Placer Mining Claim, comprising the 
Southwest Quarter of Section 24, Township 7 South, Range 98 
West of the 6 P. M. situate in Mt. Logan Mining District, County 
of Garfield, State of Colorado, containing one hundred and sixty 
acres, and the said applicant did, at the same time and place, 
give notice that he would apply for a United States Patent for 
the above described Placer Claim and premises in words and 
figures of the printed notice on margin hereof, to wit: (Here 
attach copy of newspaper publication). „ 

And AVhereas the first publication of said notice of said ap- 
plication appeared in the Oil Shale News, a weekly newspaper 
published at De Beque, in the County of Mesa, said State, on the 
25th day of October, A. D. 1920. 

Now Therefore, I, J. W. Kessinger, a citizen of the United 
States over the age of twenty-one years, residing in and my 
postoffice address being Denver in the City and County of 
Denver, in said State, do, on this tenth day of November A. D. 
1920, enter this protest and adverse claim against the issuing of 
a patent to the said J. C. Hardison, for his pretended claim upon 
the so-called Monarch Placer Mining Claim, as set forth in his 
said notice and application as aforesaid, for the following rea- 
sons, to wit: 



896 MORRISON'S OIL RIGHTS 

1. The surface ground and minerals contained therein as 
set forth and described in said notice and application, are not 
the property of the said applicant, neither is he entitled to hold 
the same under or by virtue of the local laws, rules and customs 
of miners in said mining' district, the laws of the State of Colo- 
rado, or the statutes of the United States relating to mining 
claims. 

2. Because the premises described in said notice and applica- 
tion of said applicant, and claimed as the so-called Monarch 
Placer Mining Claim, is claimed adversely, and is owned by pro- 
testant, and is in fact the premises claimed and owned by pro- 
testant as the Wilson Placer Mining Claim, as will appear by 
reference to an Abstract of Title herewith filed, made a part of 
this protest and marked Exhibit A. 

3. Because protestant and his grantors have held, occupied 
and possessed the premises set forth and described by the said 
applicant in his notice and application of the so-called Monarch 
Placer Mining Claim, long prior to the pretended discovery and 
location of the so-called Monarch Placer Mining Claim; such 
occupation and possession of protestant and his grantors having 
been under and by virtue of a full compliance with the local laws, 
rules and customs of said mining district, and the laws of said 
State and of the United States, pertaining to mineral lands ; and 
this protestant is a bona fide purchaser for a valuable considera- 
tion from the original discoverers and locators of said Wilson 
Placer Mining Claim, as shown on said abstract. 

4. Because a valid discovery, location and record of said Wil- 
son Placer Mining Claim, was made by protestant and his 
grantors, in strict compliance with said local laws, rules and cus- 
toms, and the laws of the State of Colorado and of the United 
States, and while the same was vacant mineral land of the United 
States, open to occupation, long prior to any valid discovery or 
location thereof by said applicant or his grantors, and said Wil- 
son Placer Mining Claim has been occupied and possessed as 
aforesaid, ever since its discovery as aforesaid, by protestant and 
his grantors under and by virtue of such discovery, location and 
record. 

5. That in the pretended location of said Monarch Placer 



PLACER PATENT APPLICATION 89/ 

Mining Claim said applicant did not mark and has not since 
said pretended location marked the boundaries of said claim by 
setting a stake at each corner thereof, nor did said applicant set 
a stake or mark any corner of said Monarch Placer Mining Claim. 
Therefore protestant enters this his protest and adverse claim 
against the issuance of a patent to the said applicant for his 
claim upon the so-called Monarch Placer Mining Claim. 

J. W. Kessinger. 

STATE OP COLORADO, 1 
COUNTY OF GARFIELD. J 

On this tenth day of November A. D. 1920, before me, the sub- 
scriber, a Notary Public in and for said County, personally ap- 
peared the above named J. W. Kessinger, who being first duly 
sworn, saith that he is the adverse claimant named in the fore- 
going protest and adverse claim above subscribed by him. 

That he has rsad the same and knows the contents thereof; 
that the same is true in substance and in fact ; and that the said 
adverse claim is made in good faith and to protect the better and 
prior title of protestant. 

J. W. Kessinger. 

Sworn and subscribed to before me, this tenth day of Novem- 
ber A. D. 1920. 

My commission expires April 17, 1921. 

George Edinger Notary Public. 

Verification. 

The adverse claim may be verified by the adversing claimant 
outside of the land district, or by an agent cognizant of the 
facts who must make it within the district and furnish proof of 
his agency. 34 L. D. 314. 

Suit in Support of Adverse. 

The adverse claimant must, within thirty days after filing the 
adverse claim commence proceedings in a court of competent 
jurisdiction, to determine the question of the right of possession. 
M. 0. It.— 57. 



898 MORRISON'S OIL RIGHTS 

Proceedings Suspended. 

Upon the filing of the adverse all proceedings in the land 
office, except the publication of notice and making and filing of 
affidavit thereof, are suspended until the adverse suit is deter- 
mined. 

The nature of the complaint to be filed and the proceedings 
thereunder and after suit is determined will be found in Mining 
Rights, 15th edition. 



CHAPTER 89. 

EASEMENTS. 

Right of way for Pipe Line. 

No specific regulations concerning easements or other rights 
of way have been promulgated but by Rule 30 of the Oil Cir- 
cular (P. 363) the Secretary directs that the rules contained 
in the circular of June 6, 1908, printed in 36 L. D. 567, should 
govern as far as applicable. The adoption of old rules is proper 
compliance with the requirements of section 28 in that respect. 

These rules of 1908 were made to carry out several right of 
way Acts, to-wit : 

The act of March 3, 1891 amended March 4, 1917 now printed 
as sections 4934-4937 of the Compiled Laws of 1918 granting 
rights of way to canals, ditches and reservoirs. 

The Act of May 11, 1898 extending the above recited act to 
power and irrigation purposes. Comp. L. section 4938. 

The Reservoir Act of Feb. 26, 1897. Comp. L. section 4699. 

The Oil Pipe Line Act, Limited to Colorado and Wyoming, 
May 21, 1896. Comp. L. sections 4949-4952. 

The Act of January 13, 1897 concerning reservoirs for live 
stock. Comp. L. sections 4939-4942. 

The Act of Feb. 15, 1901, Comp. L. section 4946, granting 
rights of way for numerous purposes especially telegraphs and 
telephones over public lands, National Forests and National 
Parks. 

The Act of Jan. 21, 1^95 amended May 11, 1898. Comp. L. 
section 4943, granting rights of way for mining, lumbering, 
canals and reservoirs. 

The Act of Feb. 1, 1905, Comp. L. Section 823, conferring par- 
tial jurisdiction over National Forests on the Department of 
Agriculture. 

899 



900 MORRISON'S OIL RIGHTS 

The Act of Feb. 1, 1905 Comp. L. section 4947, a general right 
of way Act. 

The said circular covers not only Pipe lines but reservoirs, 
ditch lines, telegraphs, telephones and electrical plants under the 
many Acts of Congress above cited, which Acts along with the 
regulations contain many restrictions as to timber and other 
conditions when Forest Reserves are crossed. 

Under these rules, a survey must be made, the forms of proof 
of such survey being set out at length as an Appendix to the 
rules. 47 L. D. 587. 

To what extent the special Acts referred to in the circular are 
repealed or modified by the 1920 Act, it is impossible to state 
without a lengthy review of the history of each Act, but the 
expression contained in the proviso to section 28, that no right 
of way shall "be granted over said lands for the transportation 
of oil or natural gas except under and subject to the provisions, 
limitations and conditions of this section," would seem to imply 
a repeal : In any event their many provisions inconsistent with 
the Leasing Act are abrogated. 

This circular of 1908 gives no form for an application for a 
pipe line right of way but, attempting to segregate pipe lines 
from the other easements so as to draft a form of application, 
it would seem that the petition should be addressed to the Com- 
missioner of the General Land Office, be filed in the local office, 
contain the usual preliminary averments as to citizenship and be 
accompanied by a map and verified. 

Line Crossing Forest Reserve. 

If the line crosses a National Forest, bond to protect the tim- 
ber must be given (Rule 5e) which bond cannot be fixed until 
the application has been submitted to the General Land Office 
and furthermore, the Petitioner must* file a stipulation under 
seal, containing covenants to furnish assistance to the Rangers 
in fighting fires and many other provisions set out at length in 
Rule 6. 

It is very doubtful whether such stipulation could be legally 
demanded under the grant of the right of way contained in the 
1920 Act specially permitting such right of way over National 



EASEMENTS 901 

Forests, unless the Court, should take the extreme view that the 
discretion allowed in the Act to the Department has practically 
no limits. 

Rule 39 requires an application to the Department of Agricul- 
ture for permission to cross the Reserve but this rule cannot pos- 
sibly be enforced to defeat the express grant of Right of way 
mentioned in Section 28. 

Maps of Line. 

The circular above cited contains minute directions as to the 
maps and details which the field notes must show which direc- 
tion can be followed only after close study of its provisions. 

The rules in this circular, promulgated in 1908 to cover a 
series of Acts are, most of them, totally unsuited to applications 
under the 1920 Act but we have endeavored to segregate such 
requirements as can be made to apply to the present law, in the 
form below printed. 

Form of Petition for Pipe Line Right of Way. 

To the Honorable Commissioner of the General Land Office. 

Your petitioner, The Strike Breakers' Pipe Line Company re- 
spectfully represents. 

1. That it is a. corporation organized under the laws of the 
State of Colorado. A copy of its Articles of Incorporation duly 
certified is herewith filed, marked Exhibit A. Also a certified 
copy of the general corporation laws of the said State marked 
Exhibit B. And a list of its officers marked Exhibit C and a list 
of the stockholders with their names and residences, marked Ex- 
hibit D are hereto attached. 

2. The Post Office address of the petitioning company is 450 
Equitable Building, Denver, Colorado. 

3. That your petitioner applies for a right of way through the 
Public lands for the transportation of oil under the terms of the 
Act entitled, "An Act to promote the Mining of Coal, Phosphate. 
Oil, Oil Shale, Gas and Sodium on the Public Domain," approved 
Feb. 25, 1920. 



902 MORRISON'S OIL RIGHTS 

4. That your petitioner intends to operate as a common car- 
rier and to carry government oil and to comply in all respects 
with the conditions of said Act. 

5. That the line of said survey is as follows: commencing at 
the Northeast corner of the Townsite of Florence, in the, County 
of Fremont, State of Colorado, and running thence (give course 
and distances according to the field notes), and terminates at the 
reduction works of the Carnegie Reduction Company located 
as described in said field notes. 

6. A map showing the course and distance of said pipe line 
with the field notes of the same is herewith filed marked Ex- 
hibit E. 

WHEREFORE your petitioner prays that it be granted a 
right of way of the width of 50 feet according to the survey 
shown by the map hereto attached under such limitations as are 
required by said Act and the regulations of the Department 
and it hereby accepts and agrees to conform to such regula- 
tions and all the conditions of said recited Act. 
Dated at Denver, Colo. August 5, 1920. 

The Strike Breakers' Pipe Line Company 

By Herbert F. Savage, 

President. 
Attest: Charles S. Harris, 
[Corporate Seal.] 

STATE OF COLORADO, \ ( 

CITY' AND COUNTY OF DENVER. J SS * 

Before me the subscriber, a Notary Public in and for said City 
and County personally came Charles H. Harris who being first 
duly sworn deposes and says: That he is the Secretary of the 
within named The Strike Breakers' Pipe Line Company; that 
he has read the foregoing Petition for a right of way for pipe line 
and knows the contents thereof and that the matters and things 
therein stated are true of his own knowledge; that the list of 
officers and stockholders attached to said petition as Exhibits C 
and D are true and correct lists, and that said corporation, by 



EASEMENTS 903 

resolution of its board of directors has authorized this applica- 
tion for a right of way to.be made. 

Charles H. Harris. 

Subscribed and sworn to before me this 5th day of August 
A. D. 1920. 

My Commission expires September 26, 1923. 

Frederick A. Fleming, 

Notary Public. 

The petition with the exhibits is filed in the local Land Office 
to be transmitted to the General Land Office as prescribed by 
Rule 33. According to Rule 34 they are then submitted io the 
Secretary of the Interior and returned to the local land office. 
Tli is Rule 34 was originally limited to the Reservoir Act and 
whether the above petition would require to be submitted to the 
Secretary of the Interior is not clear. 

Pipe Line Carry for Government and Others. 

Every lease of oil land under the Oil and Gas Act must provide 
that the lessee, whether owner or operator, or owner of a con- 
trolling interest in any pipe line shall at reasonable rates and 
without discrimination carry government oil or the oil of any 
person not the owner of the pipe line operating a lease, or pur- 
chasing oil under the provisions of the Act. No right of way for 
transportation is to be granted except under the conditions of 
this Section 28. 

If the pipe line becomes a common carrier, upon assuming such 
status it would be bound to carry oil for all persons and the 
repetition of these conditions is surplusage. 

The only apparent qualification to the common carrier cove- 
nant is the phrase "any citizen or company not the owner of any 
pipe line" which may be an intimation that it is not bound to 
carry the oil of a competing pipe line. 

Combinations of Lessees. Control. 

In section 27 is a provision allowing any number of lessees to 
combine to carry on a refinery or build a pipe line or lines of 
railroad for joint transportation of oil, which right of combina- 



904 MORRISON'S OIL RIGHTS 

tion they would have on general principles without the special 
permission of the Act except that the Act provides that such 
combination must be subject to the approval of the Secretary of 
the Interior. 

Then follows a general clause that if any such combination 
amounts to a conspiracy or an unlawful trust the lease thereof 
shall be forfeited by appropriate Court proceedings, which would 
seem to mean that any lessees entering into any such unlawful 
combination would place that lease in jeopardy of forfeiture. 

This section 27 seems to amount to nothing more than this; 
that a combination which was intended to prevent an output of 
oil or gas by any unlawful arrangement would become subject to 
judicial attack, the lease becoming forfeit as a part of the assets 
of the conspiring parties. The conditions under which action on 
this provision of this section might arise are so complicated that 
they cannot be anticipated. 

Regulations of Easements. 

Section 29 requires that all permits and leases shall reserve to 
the Secretary of the Interior the right to regulate the enjoyment 
of easements including rights of way, which provision is com- 
plied with by expressing such reserved power in the forms of 
both the permit and the lease printed in the regulation circulars. 

Requisition of Pipe Line by President. 

Under the terms of section 12 of the Act to provide for the 
national security and defense, approved August 10, 1917, and 
which seems to be still in force, the President is authorized, foi 
the purposes mentioned in the Act, to requisition and take over 
for use or operation by the government any pipe line or mine. 
Stat. L. 1917, 1st Sess. 279. The contingency of such a requisi- 
tion is doubtless remote. 

Revenue Taxes on Transportation. 

By the Revenue Act, approved February 24, 1919, amending 
sec. 500 of the Revenue Act of 1917, there is imposed upon the 
transportation of oil by pipe line, "A tax equivalent to 8 per 
centum of the amount paid for the transportation on or after 



EASEMENTS 905 

such date of oil by pipe line." Stat. L. 1919, 3d Sess. sec. 500 
sub. e, page 1102. The date referred to in the above quotation 
is April 1, 1919. 

Section 501, sub. d, of the same laws provides that the tax shall 
apply to all transportation by pipe line, and provides further : — 
"In case no charge for transportation is made, by reason of 
ownership of the commodity transported, or if for any other rea- 
son, the person transporting by pipe line shall pay a tax equiva- 
lent to the tax which would be imposed if such person received 
payment for such transportation, and if the tax cannot be com- 
puted from actual bona fide rates or tariffs, it shall be computed 
(1) on the basis of the rat^s or tariffs of other pipe lines for 
like services, as determined by the Commissioner, or (2) if no 
such rates or tariffs exist, on the basis of a reasonable charge for 
such transportation, as determined by the Commissioner." 

Section 502 provides that the carrier shall collect the amount 
of the tax and make monthly return under oath, in duplicate, 
and pay the taxes so collected to the collector of the district. 

Pipe Line — Common Carrier. 

In the Pipe Line cases, 234 U. S. 548, considering the Hepburn 
Act on Interstate Statute, it was held that it applied to a com- 
bination of pipe lines controlled by the Standard Oil Company. 
That it required the pipe lines as common carriers to transport 
oil but it did not disallow them to discontinue business and that 
the transportation of oil from State to State was interstate com- 
merce and that the act was constitutional both as to existing and 
future pipe lines but that the transportation of oil across the 
state line to the refineries of the owner of the oil was not inter- 
state commerce. It reversed in part and affirmed in part, Prairie 
Oil and Gas Co. v. United States, 204 Fed. 798. 

The finding of the corporation commissioner that a pipe line 
company has become a common carrier will not be disturbed on 
appeal. Where a pipe line has acted as a common carrier it can- 
not complain of the unconstitutionality of an Act after it has 
enjoyed the benefits of the Act. Pierce Oil Co. v. Phoenix Re- 
fining Co. 190 Pac. 857 (Okla.). 

For other decisions and incidents pertaining to Pipe Lines, 
see page 165. 



CHAPTER 90. 

FORMS. 

FORMS OF ARTICLES OF INCORPORATION. 

We give below forms of Articles of Incorporation of Oil Com- 
panies and of Pipe Line Companies intended to operate within 
the State of Colorado, or elsewhere after incorporation. It is 
not practicable, nor within the scope of this work, to indicate 
the different requirements of the different states, in the prepara- 
tion of the charter of a corporation. The following forms con- 
tain all the requirements of the Colorado Statutes. 

Articles of Incorporation 

Whereas Louis Hough, Leverett Davis, and Edward J-. Gag- 
non, all of the City and County of Denver, State of Colorado, 
have associated themselves together for purposes of incorpora- 
tion under The General Incorporation Acts of the State of 
Colorado, they do therefore make, sign and acknowledge these 
duplicate Certificates in writing, which, when filed, shall con- 
stitute the Articles of Incorporation of the within named 
Company. 

Article 1. Name. 

The Name of said Company shall be "The Blue Dragon Oil 
Company." 

Article 2. Object. 

The Objects for which said Company is created are to bore, 
drill, sink and search for oil, and incidentally, for natural gas, 
and to apply for and secure permits and leases on the Public 
Domain under the Oil Leasing Act approved February' 25, 1920 
(Public No. 146) and to purchase or lease oil wells and oil 

906 



FORMS 907 

bearing land and howsoever acquired to prospect the same for 
oil and gas and to work the same and to sell, ship, pipe and 
refine the oil and other products of such wells. 

And to buy and sell petroleum and the by-products of oil 
wells, including natural gas, and to manufacture and deal in 
all the products of petroleum. 

And to do all things incident to the acquisition, ownership and 
disposal of oil wells and oil products. 

Article 3. Duration. 

The Term of Existence of said Company shall be twenty years. 

Article 4. Shares. 

The Capital Stock of said Company shall be ($100,000) One 
Hundred Thousand Dollars, divided into One Hundred Thous- 
and (100,000) shares of One Dollar each. 

Article' 5. Directors. 

The Number of Directors of said Company shall be Five, and 
the names of those who shall manage the affiairs of the Com- 
pany for the first year of its existence are Louis Hough, Leverett 
Davis, Edward J. Gagnon, all of Denver, Colorado and Albert 
H. Fay, of Washington, District of Columbia, and Edward J. 
Goppert, of Cody, Wyoming. 

Article 6. Office. 

The Principal Office of said Company shall be kept at the 
City of Boulder, in the County of Boulder in said State, and 
the Principal Business of said Company shall be carried on in 
said County of Boulder. 

Article 7. Assessments. 

The Stock of said Company shall be Non-assessable. 



908 MORRISON'S OIL RIGHTS 

Article 8. By-laws. 

The Board of Directors shall have power to make such pruden- 
tial By-Laws as they may deem proper for the management of 
the affairs of the Company, not inconsistent with the laws of 
this State, for the purpose of carrying on all kinds of business 
within the objects and purposes of such Company. 

Article 9. Cumulative Voting*. 

Cumulative voting of the stock of said Company shall not be 
allowed. 

In Witness Whereof the said Incorporators have hereunto 
set their hands and seals this 14th day of August, A. D. 1920. 

Louis Hough [seal.] 

Lever ett Davis [seal.] 

Edward J. Gagnon [seal.] 

STATE OF COLORADO } 
CITY AND COUNTY OF DENVER \ SS ' 

I, Frederic A. Fleming a Notary Public in and for said City 
and County, do hereby certify that Louis Hough, Leverett Davis 
and Edward J. Gagnon who are personally known to me to be 
the same persons described in and who executed the within 
Articles of Incorporation, personally appeared before me this 
day and acknowledged that they signed, sealed and delivered 
the same as their free and voluntary act and deed. 

Witness my hand and Notarial seal this 14th day of August, 
A. D. 1920. 

My Commission expires September 26, 1923. 

Frederic A. Fleming, 

Notary Public. 
Branch Office Out of State. 

Where it is intended to have a branch office or transact part 
of the business out of the State, the articles must so provide: 

Article 10. 

A part of the business of the company may be carried on in 
the County of Wayne, State of Michigan, and a branch office 



\ 



FORMS 909 

of the company may be kept in the City of Detroit in said 
County of Wayne, at which meetings of the directors may be 
held. 

There is no statutory provision for holding stockholders' 
meetings outside of the State, and it has been held that they 
may not lawfully be held without the State. Jones v. Pearl M. 
Co., 20 Colo. 417, 38 Pac. 700. 

In the Preamble any three or more persons who may or may 
not be residents of Colorado, may be named as incorporators. 
Laws 1919 p. 348. 

In Article 1 the name must contain the word Corporation, 
Association, Company, Society Incorporated, Syndicate or one 
of the abbreviations "Co." or "Inc." Id., p. 347. 

In Article 3 the term of existence may not exceed twenty 
years. Id., p. 348. 

In Article 4, the par value of the stock shall not exceed one 
hundred dollars per share nor be less than one dollar per share. 
Id., p. 350. 

In Article 5, the directors shall be not less than three nor 
more than nine. R. S. sec. 977. 

In Article 6, if business is to be carried on in more than one 
county, certificates must be made, and filed in each county in 
which business is to be done. Id., p. 348. 

In Article 7, it must be stated in the case of mining com- 
panies wh ether or not the stock is assessable or non-assessable 
and the certificates of stock must have printed on their face 
the word "assessable" or "non-assessable" as* the case may be. 
R. S. Sec. 975. 

In Article 8, providing for by-laws to be made by the board 
of directors is necessary only when it is intended that the 
directors and not the stockholders shall have that power. R. S. 
Sec. 853. 

In Article 9, it must be stated whether or not cumulative 
voting of the stock should be allowed. Laws 1919, p. 353. 

Articles of Oil Shale Company 

Article 1. The name of said company shall be The Submarine 
Oil Shale Company. 



910 MORRISON'S OIL RIGHTS 

Article 2. The purposes for which said company is created 
are to mine and extract oil bearing shale, to tram or otherwise 
transport the same to the plant or railroad and to reduce and 
treat the same for the extraction of petroleum, gasoline, tar, 
paint, dyes, chemicals, and all other products contained in or 
reducible from such shale rock, and to manufacture all such 
things and products and to market and sell the same. 

And in such operations to build, erect, purchase and operate 
mills, reduction works, chemical laboratories, furnaces, stills 
and plant of any and all kinds necessary or useful to extract 
and advance to commercial form all the values found in such 
shale. 

To sell and exchange the products, and by-products of such 
shale. To construct and operate tramwaj^s to connect with any 
neighboring railroads and other highways of transportation. 

And to keep stores, warehouses and boarding houses in the 
operation of said business and to do all things incident to or 
usual in the production, treatment and disposal of shale and the 
products of shale.. 

And to acquire oil shale lands or interests in the same by 
purchase, private leases or leases from the United States under 
the Oil leasing bill approved February 25, 1920 (Public No. 
146) or by sublease or in any other legal manner and to perfect 
title to located Oil Shale claims by patent and from time to 
time to demise or sell lands or interests acquired and to deal 
iu oil shale lands generally. 

The Preamble, other Articles and the acknowledgment as in 
form on page 906. 

Articles of Oil Pipe Line Company 

Article 1. The name of said Company shall be The Venture 
Oil Pipe Line Company. 

Article 2. The objects and purposes for which said Company 
is created are to acquire by purchase or otherwise, or by the 
right of the exercise of eminent domain, a right of way for an 
oil pipe line, and to construct and maintain such pipe line for 
the carriage and transportation of oil on its own behalf and 
for hire, from oil wells along the course and route of said pipe 



FORMS 911 

line, in the County of Boulder, said State, to tanks to be con- 
structed and maintained at the easterly terminus of said pipe 
line. Said line begins at a point near the Southeast corner of 
section 36 Township 2 South Range 69 West of the 6th P. M. 
and runs thence in an easterly direction a distance of ten miles 
to the easterly terminus of said pipe line at the Southeast cor- 
ner of section 22 Township 3 South Range 67 West ; to acquire 
in the same manner, and construct branch pipe lines from any 
and all wells in said locality and in general, to do all things 
incident to the business of transporting oil in pipe lines, for 
hire or as broker or agent. 

The Preamble and other Articles and acknowledgment as on 
page 906. 

The additional statutory requirements of a pipe line company 
are that its articles shall state the places from and to which it 
is intended to construct the proposed line. R. S. sec. 999. 

For Right of Way for pipe line over public lands, see page 899. 

FORMS OF TRUST AGREEMENTS. * 

In recent years there has come into extensive use, especially 
in Texas and Oklahoma, a Trust Agreement or Business Trust, 
for the management of all kinds of business, but more particu- 
larly of late for the conducting of enterprises in the oil business. 

Under the trust agreement, the property intended to be oper- 
ated is conveyed to one or more Trustees who are given full and 
absolute control of the management, sale and disposition of the 
estate conveyed, with like power of increasing the estate, as they 
see fit. 

Capital for working operations, when needed, is raised by the 
sale of certificates showing beneficial interest, issued by the trus- 
tees, and the purchasers become beneficiaries under the trust 
agreement. The agreement fixes the rights and powers of cer- 
tificate holders or beneficiaries, and specifically' provides that 
they shall have no interest in the property of the estate except 
to receive such dividends as may be declared by the trustees. 
In some instances the beneficiaries are given the power by the 
trust instrument to periodically elect the trustees and to fill 
vacancies and even to remove a trustee when occasion necessitates 



912 MORBISON'S OIL RIGHTS 

it. It contains limitations so as not to in any manner confer 
upon the beneficiaries any powers tending to create the relation 
of a partnership, and provides that only the estate shall be liable 
for any act of the trustee. 

Advantages of the Trust. 

It is contended that the trust agreement has numerous ad- 
vantages over the corporation or joint-stock association. Some 
of the advantages suggested are that the plan furnishes a flexible 
capital which can be increased or diminished at pleasure; the 
right to remove the trustees at will, where that power is given in 
the instrument; relief from heavy taxes both state and federal 
on the mere right to do business ; and from income tax ; freedom 
from the obligation of filing inquisitorial reports; ability of 
the trustees to do business in any State without being required 
to comply with the corporation laws of such state and limited 
or entire non-liability of the shareholders. 

Disadvantages of the Trust. 

The disadvantages are more in apprehension than present 
reality. If such trusts conflict with, or violate the incorporation 
laws of the states where the business trust may be in use, 
future legislation may attempt to control the trust in much. the 
same manner as the corporation is now controlled. At present, 
however the trust agreement is more extensively used in states 
whose laws either do not provide the necessary facilities to a 
corporation or joint-stock company for carrying on' the same 
business, or whose laws limit and restrict corporations in their 
right to hold real estate. 

Massachusetts Trusts. 

In Massachusetts the trust agreement form of carrying on a 
business has been in use for over a quarter of a century and it 
may be suggested that its extensive use in that state is due to 
the fact that, as stated in Bicker v. American L. & T. Co., 140 
Mass. 346: "Joint stock companies of the statutory character 
are not known to the laws of that Commonwealth." 



FORMS VIS 

Texas Trusts. 

In Texas a different reason exists for the use of the trust 
agreement. That state has a statute which reads : — 

"No private corporation heretofore or hereafter chartered or 
created, whose main purpose of business is the acquisition or 
ownership of land by lease, purchase or otherwise, shall here- 
after be permitted to acquire any land within this state by 
purchase, lease or otherwise." Acts 1893, page 36; Vernon's 
Sayles' Tex. Civ. Stats., 1914, Article 1176. 

The first necessary acquisition by an oil company is the land 
under which may be the oil, and in Texas such a company is 
forced to adopt the trust agreement form of conducting its 
business. If the above Act was passed for the purpose of con- 
trolling and limiting the acquisition of lands supposed to contain 
oil, it might be assumed that legislation may sooner or later 
seek to place limitations upon oil operations carried on under 
the trust agreement. 

Oklahoma Trust Agreement Act. 

An encouraging feature, however, to those in favor of the 
trust, may be found in the fact that Oklahoma, has recognized 
the trust agreement by legislative Act. Laws 1919, page 30, 
Approved March 22. 

Its first section provides that express trusts may be created, 
which is, of course, merely a recognition of the common law 
right to create a trust. 

Section 2 provides that the trust shall be created by a written 
instrument properly acknowledged, to be recorded in the county 
wherein is situated any real estate conveyed to the trustee and 
where the principal office is located or the business conducted, 
and requires that the trust shall be "limited in the duration 
thereof either to a definite period of not to exceed twenty-one 
years, or to the period of the life or lives of the beneficiaries 
thereof" and that the instrument shall specify the period. 

Section 3 says that the instrument "may provide for succes- 
sion to any trustee" and that "the title to the trust property 
shall at once vest in the succeeding trustee." 
M. 0. R.— 58. 



914 MORRISON'S OIL RIGHTS 

Section 4 provides that the liability of the trustee to third 
persons for any Act or omission extends to the whole trust estate, 
"but no personal liability shall attach to the trustee or the bene- 
ficiaries of such trust for any such act, omission or liability." 

Rule against Perpetuities. 

It will be noticed that the Oklahoma Act limits the duration 
of the trust to twenty-one years, or "to the period of the life or 
lives of the beneficiaries thereof." This last alternative raises 
the interesting question as to what beneficiaries are contem- 
plated. The purpose of the trust is, in most cases of oil ad- 
ventures, to sell certificates to shareholders, and new ones who 
so become beneficiaries may be coming in from time to time for 
an indefinite period of years and extend the trust beyond the 
time permitted by the rule. For want of known adjudication 
upon this question as applied to. these trusts it will be safer to 
limit the duration of the trust to a period of a life or lives in 
being, naming them in the instrument, and twenty-one years 
thereafter, and thus be safely within the rule. 

Judicial Recognition of the Trust Agreement. 

Massachusetts has upheld the common law trusts or trust 
agreements used in that state for the carrying on of business 
and its Courts have said that the sole right of the cestuis que 
trust is to have the property administered in their interest by 
the trustees, who are the masters, to receive income while the 
trust lasts, and their share of the corpus when the trust comes 
to an end. Williams v. Milton, 215 Mass.* 1. 

In Crocker v. Malley (C. C. A.) 250 Fed. 817, the question 
was whether the Wachuset Realty Company, a common law 
trust, was liable to income tax under section II, Income Tax 
Act, 1913, which imposed a tax on the income of corporations, 
joint stock companies and associations, and the Court held, that 
in a common law trust which authorized the trustees to collect 
the income and to pay over to the beneficiaries such portion as 
the trustees might in their discretion determine to be fairly dis- 
tributable, the beneficiaries having no right to compel the trus- 



FORMS 915 

tees to pay any sum, the power of the trustees resembled that 
of directors of a corporation, and as the income could not be 
deemed that of. the beneficiaries until received by them, the 
trustees, though not subject to taxation as partners, could not be 
deemed an association nor the income received by them taxable. 

Upon Certiorari, the Supreme Court reversed the Circuit 
Court of Appeals, and held that neither the trustees nor the 
beneficiaries, nor all together, could be regarded as a joint stock 
association within the meaning of the Income Tax Law. Crocker 
v. Malley; 249 U. S. 223. 

There are many questions concerning the Trust Agreement 
which may arise, but which have not, to our knowledge, been 
adjudicated, and no such agreement can be safely entered into 
without the counsel and advice of a lawyer. 

Forms of Trust Agreement. 

We give below two forms of a Trust Agreement, the first of 
which was carefully prepared by Mr. Charles H. Haines, of 
the Denver Bar, which contains practically all the protection, 
limitations and powers which will be found necessary in the 
preparation of such an instrument for conducting any kind of 
business. It is not necessary as in the case of the Charter of a 
Corporation that the instrument shall state what the business 
objects and purposes of the trust may be nor what kind of busi- 
ness is to be carried on. 

AGREEMENT AND DECLARATION OF TRUST OF THE 
GRINNELL TEXAS COMPANY 

This agreement and declaration of trust made this first 
day of October, 1914, by and between SAMUEL H. CROSBY 
and L. L. HARRIS, both of the County of Poweshiek, State of 
Iowa, parties of the first part, and J. H. T. MAIN and EVAN 
S. EVANS, also of the County of Poweshiek and State of Iowa, 
acting for themselves and all other persons who may hereafter 
at any time or in any manner become shareholders in "The 
Grinnell Texas Company" as hereinafter provided, parties .of the 
second part, and WILLIAM T. MOYLE and* SAMUEL J. 



916 MORRISON'S OIL RIGHTS 

POOLEY, also of the Comity of Poweshiek and State of Iowa y 
acting for themselves and all persons who may succeed them as 
trustees under this agreement, parties of the third part, 

WITNESSETH ■ 

That whereas parties of the first part have originated and 
developed a plan for the reclamation of land in the State of 
Texas by means of dikes and drainage, and for the improve- 
ment, cultivation and ultimate sale of such lands at a profit, as 
it is expected, and to that end have acquired certain interests 
in certain lands as hereinafter more definitely set forth, and 
have had said lands surveyed, and have had maps, plats, plans, 
profiles and other charts made for the necessary dikes, ditches 
and other works for reclaiming said lands, and have had soil 
tesV? made and opinions of experts given as to the feasibility of 
their said plan, all at an expense to themselves exceeding $12,- 
000.00, in addition to the notes hereinafter assumed by the 
Trustees, copies of which said surveys, maps, plats, plans, pro- 
files, charts and opinions have been submitted to parties of the 
second and third parts ; and 

Whereas The value of the interest in said real estate so ac- 
quired by parties of the first part is, as all parties hereto firmly 
believe, greatly in excess of $12,000.00, and large profits can be 
made by carrying out said plans ; and 

Whereas Said parties of the first part desire to obtain the 
financial assistance and co-operation of parties of the second 
part and all other persons who may desire to become sharehold- 
ers in THE GRINNELL TEXAS COMPANY, as hereinafter 
provided, in carrying out said plans and in acquiring, improv- 
ing, cultivating, selling and dealing in other lands in the State 
of Texas, and in carrying on a general agricultural, live stock 
and land business ; and 

Whereas It is the desire and intention of all parties hereto to 
provide a method of financing said enterprise by which a large 
number of small contributors, including parties of the second 
part, may, by combining their contributions, secure the benefits 
and profits to be made by a large investment in said enterprise, 
and which shall relieve the contributors of the necessity of giv- 
ing personal attention to the details of such business and which 



FORMS 917 

shall permit the aggregate capital to be invested in real estate 
while the interest of each contributor shall remain personal prop- 
erty in the form of a negotiable certificate, and shall avoid per- 
sonal and individual liability on the part of the contributors 
for the obligations incurred in the management of the property 
and business, and shall secure to the contributors, subject to 
the payment of all debts, costs and expenses, the return of their 
capital invested, together with a fair proportion of the profits 
to be made upon such investment, and shall secure to parties of 
the first part the return of their capital invested upon equal 
terms with the capital invested by the contributors, together 
with the same proportion of profit on their investment which 
the contributors receive and in addition thereto, but subsequent 
to the return of all capital invested, the compensation to which 
parties of the first part are entitled for originating and incur- 
ring the risk of the initial expense of the enterprise ; and 

Whereas The parties hereto believe that the objects above 
mentioned can be best attained by placing such contributions in 
the hands of trustees to invest with full power to manage the 
property and business subject to the obligation of accounting 
to the contributors, their administrators, executors or assigns 
for the income arising therefrom, and finally for the capital in- 
vested and the profits thereon ; and 

Whereas, Parties of the first part are willing and agree to 
contribute to such trust the property above referred to and 
hereinafter -more specifically described at a valuation of $12,- 
000.00 in return for share certificates as herein provided, and 
parties of the second part are willing and desire to participate 
in the benefits of such trust and agree to contribute thereto in 
cash at least one hundred dollars each, in return for similar cer- 
tificates, and parties of the third part are willing to act as in- 
terim trustees of said trust under this instrument and hereby 
accept the said office ; 

Now therefore The terms and conditions of said trust are 
hereby declared to be as follows : 

First. At all times, except in emergencies as hereinafter pro- 
vided, there shall be two trustees of the assets of the trust estate 
who shall be elected by the shareholders annually. WILLIAM 



918 MORRISON'S OIL RIGHTS 

T. MOYLE and SAMUEL J. POOLEY, the parties of the third 
part, are hereby designated as, and hereby accept the office of, 
first or interim trustees of this trust, to serve until their suc- 
cessors are elected at the first annual meeting of the sharehold- 
ers, which shall be held without further notice at the office of The 
Grinnell Savings Bank in the City of Grinnell, County of Powe- 
shiek and State of Iowa, on Monday, the fourth day of January, 
1915, at the hour of ten o'clock in the forenoon. At the time 
and place designated the shareholders shall meet and select two 
trustees to serve for one year or until their successors are elected 
and have qualified as hereinafter provided. At such meeting, 
if a quorum be present, the old trustees shall make a full report 
of their management of the trust estate and its condition; their 
books shall be audited by a committee of the shareholders; and 
new trustees shall be elected for the ensuing year. Thereafter 
the trustees serving during the months of December or January 
of each year shall call a meeting of the shareholders to be held 
at Grinnell, Iowa, on some convenient date during the month 
of January, notice of which meeting shall be mailed to all share- 
holders at their respective addresses, as the same appear on the 
trustees' books, not less than five days nor more than thirty 
days prior to the date of such meeting. In case, for any reason, 
the annual meeting is not held in the month of January, as 
above provided, it shall be the duty of the trustees to call such 
meeting as promptly as possible thereafter, and any five holders 
of common shares or a less number owning in the aggregate ten 
per cent (10%) of the outstanding common shares may call an 
annual meeting after the thirty-first day of January if none 
has been held that year. 

Second. The trustees shall receive the property of parties of 
the first part hereinabove mentioned and hereinafter more par- 
ticularly described, and the contributions of parties of the sec- 
ond part and all other persons who desire to become shareholders 
hereunder, subject to their power to refuse contributions as 
hereinafter described; and shall invest said money and manage 
said property and carry on all the business of the company free 
from any control, restraint, or interference on the part of the 
shareholders, with the following powers, to-wit: 



FORMS 919 

(a) To acquire by purchase, lease, exchange, or in any other 
lawful manner, real estate or any interest therein, to improve 
the same by drainage, irrigation, erecting buildings thereon, or 
in any other manner deemed by them to be expedient. 

(b) To farm, till, set to trees, or otherwise use and employ 
lands held by them in fee or under lease; to engage in agricul- 
ture, horticulture, the raising of live-stock; to engage in any 
manufacture or industry for the utilization or preparation for 
sale of the products of agriculture, horticulture and stock rais- 
ing, or of any valuable thing in or appurtenant to lands held by 
them ; to buy and sell all such products. 

(c) To manage and control the lands, works and improve- 
ments by them acquired, and to enlarge or improve the same in 
whatever manner they deem expedient, and to maintain the same 
in good repair, order and condition; and to receive the rents, 
profits and income arising from the trust premises. 

(d) To make any arrangements with the owners of the ad- 
joining or adjacent lands in their judgment deemed expedient 
for the improvement and development of the lands, and to ac- 
quire any rights or easements that they shall deem requisite. 

(e) To let, lease, sell, exchange, or otherwise in any lawful 
manner to dispose of, for such sums and upon such terms as 
they deem wise, all or any part of, or any interest in, the lands, 
works and improvements in their hands as trustees. 

(f ) To raise or borrow money and give the obligations of the 
trustees therefor for the purpose of the trust from time to time 
as they shall think proper ; and to mortgage, pledge, hypothecate, 
or otherwise encumber, the whole or any part of the trust estate 
in such manner and on such terms as they shall think proper 
for securing the repayment of any moneys so raised or bor- 
rowed; and to pay off any such mortgage or charge, or to make 
a new mortgage or charge for any sum or sums; to pay com- 
missions to promoters and brokers for the sale of shares or se- 
curities; to pay legal charges, trustees' compensations or com- 
missions, and all other proper charges in connection therewith. 

(g) To insure the buildings or improvements against loss or 
damage by fire or other casualty ; to procure liability insurance 
or marine insurance ; to procure and require any other insurance 



920 MORRISON'S OIL RIGHTS 

or indemnity they may deem necessary, and to apply the moneys 
received under any insurance or indemnity in any proper man- 
ner to the trust premises. 

(h) To buy or in any other lawful manner to acquire, sell, or 
in any other lawful manner to dispose of, any and every kind 
of personal property by the trustees deemed necessary, profitable 
or advantageous to the trust estate. 

(i) The trustees shall hold the legal title to all property at any 
time belonging to this trust and, subject only to the specific 
limitations herein contained, they shall have the absolute con- 
trol, management and disposition thereof and shall likewise have 
the absolute control of the conduct of all business of the trust. 

(j) The trustees shall have authority at their discretion to 
adopt a seal and cause a description and impression thereof to 
be recorded, and may execute such instruments under such seal 
as they may deem best for and on behalf of the trust estate; to 
make all such contracts as they may deem expedient in the con- 
duct of the business of the trust ; from time to time release, sell, 
exchange or otherwise dispose of at public or private sale any 
or all of the trust property, whether real or personal, for such 
prices and upon such terms as to credit or otherwise as they 
may deem expedient ; to confer such power and authority on 
officers and agents appointed by them as they shall deem ex- 
pedient; to loan any money from time to time in the hands of 
the trustees, with or without security, on such terms as they 
may deem expedient; to collect, sue for, receive and receipt for 
all sums of money at any time becoming due to said trust; to 
employ counsel and to begin, prosecute, defend and settle suits 
at law, in equity or otherwise, and to compromise or refer to 
arbitration any claims in favor of or against the trust; and in 
general to do all such matters and things as in their judgment 
will promote or advance the business which they are authorized 
to carry on, although such matters and things may be neither 
specifically authorized nor incidental to any matters or things 
specifically authorized. 

(k) The enumeration of powers herein contained shall not be 
construed in any way as a limitation upon the general powers 
conferred upon the trustees hereby. 



FORMS 921 

Third. The title to all property, both real and personal, taken 
by the trustees under this agreement shall vest in them in joint 
estate or ownership, and not as tenants or owners in common, 
and in the survivor of them and the heirs and assigns of such 
survivor, subject, however, to this defeasance in case the prop- 
erty be not conveyed or assigned by them under the powers 
herein expressed, to-wit: That when successors in trust have 
been selected by the shareholders as herein provided and have 
qualified by accepting the office and complying with any other 
conditions which the shareholders may impose, then all the right, 
title and interest of the former trustee or trustees in any and 
all property of every kind and nature held by them at that time 
under this trust shall immediately terminate and shall vest in the 
new trustees with all the power and authority, and subject to 
all the obligations of any and all of their predecessors in trust. 
The heirs, executors, administrators or testamentary assigns of 
a deceased sole trustee in whom the title to any property under 
this trust may vest by virtue of the terms of this instrument or 
by the terms of any assignment or conveyance to any trustee 
or trustees, shall be dry trustees of the legal title merely, without 
any obligation, power or authority to sell, mortgage, convey or 
otherwise deal with the same, and such title as they may have 
shall terminate upon the selection and qualification of new 
trustees by the shareholders under this agreement, and shall 
vest in such new trustees with all the powers and authority con- 
ferred upon any trustees by this instrument. 

Fourth. So far as practicable, all business which the trustees 
shall conduct under this trust agreement shall be conducted in 
the name of THE GKINNELL TEXAS COMPANY, which 
name shall be deemed to be the collective and continuing name 
of the trustee or trustees serving at any time and his or their 
predecessors and successors, but which shall not be deemed to 
indicate the collective name of the shareholders. The trustees 
may receive all contracts, obligations conveyances and assign- 
ments, and may execute all contracts, obligations, conveyances 
and assignments on behalf of the trust estate in that name, ad- 
ding thereto in cases where they execute any such contract, ob- 
ligation, conveyance or assignment, tne names 01 the trustees 



922 MORRISON'S OIL RIGHTS 

who executed the same. However, any trustees may, when, un- 
der the advice of counsel or otherwise, it is deemed advisable, 
receive or execute contracts, obligations, conveyances, or assign- 
ments in their own names as trustees without the use of the 
collective name, and such contract, obligation, conveyance or 
assignment, whether in the name of THE GRINNELL TEXAS 
COMPANY or the then trustees in their own names as such, 
shall operate for the benefit of, or shall bind, as the case may be, 
the then trustees and the survivor of them and their or his 
successor or successors in trust under this agreement. 

Fifth. At the regular annual meeting of the shareholders, any 
business affecting this trust may be transacted without specific 
mention thereof in the notice of the meeting, except as otherwise 
herein specified. The trustees or any five holders of common 
si 1 ares or a less number owning in the aggregate ten per cent 
(10%) of the outstanding common shares may at any time, by 
giving notice in the same manner as is required for an annual 
meeting of xhe shareholders, call a special meeting of the share- 
holders, to be held at Grinnell, Iowa, to take action upon any 
matter which may be submitted to them respecting this trust, 
provided the business to be transacted at such meeting is speci- 
fied in the notice. The shareholders may at such a meeting 
remove one or both of the trustees and fill the vacancy or vacan- 
cies so caused, or may fill vacancies caused by the death, resigna- 
tion, incapacity, or refusal to act of both trustees or a sole 
trustee. At all shareholders' meetings a chairman and a secre- 
tary shall be selected from among their number, who shall per- 
form the respective duties usually incident to such office. The 
minutes of the meeting shall be signed by the chairman and the 
secretary and lodged with the trustees for preservation. 

Sixth. Whenever one of the trustees shall die or resign or 
become incapacitated, the other trustee shall have power to ap- 
point a co-trustee to serve with him until new trustees shall be 
selected, as herein provided, and shall qualify, and as soon as 
such co-trustees shall have qualified by accepting the office and 
complying with any requirements that may be imposed by the 
shareholders, title to all property belonging to the trust estate 
shall vest in him jointly with the continuing trustee in the same 



FOKMS 923 

manner and with the same force and effect, and with the same 
powers, as if they had been selected by the shareholders as joint 
trustees at one and the same time as herein provided. In such 
case the continuing trustee shall file in the office of the Recorder 
of each and every county in which the trustees hold any interest 
in real estate, appropriate proof of the fact of the death, resigna- 
tion, incapacity, or removal of the former co-trustee, together 
with a certificate of the appointment and qualification of the 
new co-trustee, and the written acceptance of such new co-trus- 
tee, and such an instrument when recorded- shall be deemed 
conclusive evidence in favor of strangers dealing with the trus- 
tees, of the facts therein recited. 

Seventh. Whenever at an annual or special meeting of the 
shareholders new trustees shall be elected and shall qualify, it 
shall be the duty of the former trustees and each of them, or of 
the former trustee if there be only one, to deliver to the new 
trustees a certificate of the fact that their or his term of office 
has expired, or that they or he had resigned or had been re- 
moved, or such other circumstance as made proper the selection 
of new trustees by the shareholders, and that the new trustees, 
whose names shall be designated in the certificate, have been 
duly elected to the office and have qualified, and the new trustee 
shall record such certificate in the office of the Recorder of each 
and every county in which any real estate belonging to the trust 
is situated, together with their written acceptance of the office, 
and when such papers are so recorded they shall be conclusive 
evidence of the facts therein recited in favor of any person rely- 
ing thereon. Nothing herein contained shall be construed to 
mean that it shall be necessary to file a certificate of the re- 
election of the former trustees, but all persons may rely upon 
the absence from the records of a certificate of the election of 
new trustees as conclusive evidence that the former trustees have 
been duly continued in office. 

Eighth. Whenever through any occurrence or in any event, 
there shall be no active trustee of the trust estate capable of mak- 
ing the certificate of the election of the new trustee required by 
the foregoing paragraph, or when any former trustee shall fail 
or refuse to make such certificate, then the President and the 



924 MORRISON'S OIL RIGHTS 

Secretary of the shareholders' meeting at which new trustees 
were selected shall make the certificate which, when filed with 
the acceptance of the new trustees, shall have the same con- 
clusive effect as a certificate of the former trustees. 

Ninth. Whenever after the retirement of any trustees or trus- 
tee under this agreement, from office in any manner, any suc- 
cessors or successor in trust shall demand of them or him that 
they or he execute any conveyance, assignment or other instru- 
ment of further assurance of the title which they or he had for- 
merly held in trust, they or he shall comply with such demand 
unless the same shall be inconsistent with some previous grant 
or act of the former trustees or trustee. 

However, nothing in this paragraph or elsewhere in this in- 
strument shall be deemed to indicate that it shall be necessary 
to obtain any kind of a certificate or conveyance or assignment 
or other instrument to terminate the title or ownership or power 
or authority of any retiring trustee or trustees, or to vest the 
same in his or their duly chosen and qualified successor or suc^ 
cessors in trust; but such title, ownership, power and authority 
shall terminate in the former trustee or trustees and vest in the 
new trustee or trustees immediately upon the selection, accept- 
ance and qualification of such new trustee or trustees, without 
any act whatsoever on the part of the former trustee or trustees. 

Tenth. At any time when there are two qualified trustees un- 
der this trust they shall act with reference to the trust estate 
jointly only, and neither shall have authority to convey, mort- 
gage, or encumber any part of, or interest in, the trust estate 
by his individual act unless his co-trustee shall have conferred 
such authority upon him by a power of attorney in writing, 
which shall specify the act which such trustee is authorized to 
perform in their joint names, and the trustee so authorized may 
under such circumstances bind the trust estate by his act in their 
joint names in the respect mentioned in the power of attorney. 
The trustees may jointly appoint an attorney to act in their joint 
names for the performance of any act which they might lawfully 
perform with reference to the trust estate. Whenever there is 
a sole trustee he shall have no power or authority to perform any 



FORMS 925 

act with reference to the trust estate, except to appoint a co- 
trustee or to call a meeting of the shareholders. 

Eleventh. No shareholder shall have any authority to act for 
or on behalf of the other shareholders individually or collect- 
ively, or for or on behalf of either trustee or both trustees jointly, 
except by virtue of a valid power of attorney as hereinabove 
provided, nor shall the shareholders collectively have any power 
or authority to control the property or affairs of the trustees 
or to direct or control the trustees, except to remove one or both 
of tli em, and to select a new trustee or trustees as hereinabove 
provided. The shareholders shall not have any estate, right, 
title or interest in any of the property of the trust estate, save 
and except the right to receive such cash distributions as the 
trustees may make under the power and authority herein con- 
ferred upon them. Neither shall the shareholders have any right 
to sue for a partition or distribution of the trust estate or any 
part thereof, until the term of the trust, as herein limited, has 
expired or the shareholders have ordered that it be wound up as 
hereui provided, and in such case the shareholders shall receive 
their respective shares only in cash. The trustees shall not be 
required to render an account to any shareholder individually, 
but shall be required to render an account at each annual meet- 
ing of the shareholders and at such special meetings as they may 
be requested so to do by a proper vote of the shareholders. No 
shareholder may sue for an accounting except upon the failure 
or refusal of the trustees to render an account as hereinabove 
provided. Whenever one or both trustees retire, he or they shall 
render an account to the successors in trust. If there were two 
former trustees and only one retired, they shall nevertheless ren- 
der a joint account to the date of the retirement of one. The 
trustees shall always have the right, when they deem it neces- 
sary, to demand, and if necessary, to sue for an accounting of 
any former trustee or trustees. 

Twelfth. The trustees shall issue share certificates to the 
contributors to the trust estate of two classes, one to be desig- 
nated "preferred share certificates" and the other "common 
share certificates." To every contributor of the sum of $100.00 
in cash, or an even multiple thereof, and to every contributor of 



926 MORRISON'S OIL RIGHTS* 

property, accepted by the trustees by agreement with the con- 
tributor at its true valuation, the trustee shall issue a certificate 
for one preferred share in the trust estate for each $100.00 of 
value so contributed, whether in cash or in property, and also 
a certificate for one common share for each preferred share so 
issued, and shall at the same time issue to parties of the first 
part, as part payment for the property contributed by them 
as hereinafter provided, one common share for each preferred 
share so issued. The holders of preferred and common shares 
respectively shall have and exercise all the rights and privileges 
which are conferred upon them by the terms of their certificates, 
and by this agreement and amendments thereto, but in case of 
any conflict between the terms of the certificates and the. terms 
of any other part of this agreement and amendments thereto, 
the words of such other part of this agreement and amendments 
shall control the words appearing in the certificates. 

Thirteenth. The form of the certificate of both common and 
preferred shares shall be substantially as follows: 

THE GRINNELL TEXAS COMPANY 

Number Number of Shares 

This certifies that is the owner of 

(preferred or common) shares in The Grin- 

nell Texas Company, a trust created by a certain Agreement and 
Declaration of Trust, dated October 1, 1914, and executed by 
Samuel H. Crosby and L. L. Harris, as parties of the first part ; 
J. H. T. Main and Evan S. Evans, as parties of the second part; 
and William T. Moyle and Samuel J. Pooley as parties of the 

third part, which instrument is now on file with 

at Gr inn ell, Iowa, and which is to be kept on file at all times 
until the termination of said trust with said bank or trust com- 
pany, or such other bank or trust company in Grinnell, Iowa, 
as the trustees may from time to time designate, subject to in- 
spection by the holder of this certificate, and to which instru- 
ment the holder is hereby referred for a more accurate and de- 
tailed statement of his status and rights. The holder hereof 
by accepting this certificate assents to all the terms and condi- 
tions of said Agreement and Declaration of Trust, and consents 



FORMS 927 

that the terms of this certificate shall be in all respects controlled 
thereby. 

For every $100.00 contributed to the trust estate, certificates 
for one preferred share and two common shares therein have 
been or shall be issued. 

The holders of preferred share certificates shall be entitled to 
receive out of the trust estate the sum of $100.00 for each share 
represented thereby after all debts have been paid and before 
any dividends are paid to the holders of common share cer- 
tificates. When $100.00 has been paid to the holder of any 
preferred share certificate for each share represented thereby, 
the certificate shall be surrendered to the trustees and cancelled, 
The trustees may, at their option, at any time retire all or any 
of the preferred certificates by any of the methods provided in 
the Agreement and Declaration of Trust, or make payments on 
account of the principal represented by such certificates, which 
payments shall be endorsed on the certificate. Preferred share- 
holders shall have no right to vote at shareholders' meetings, 
such meetings being controlled solely by holders of common 
shares. 

After the retirement of all preferred shares, the holders of 
common share certificates shall be entitled to receive a pro rata 
distribution of such portion of the net annual income as the 
trustees may appropriate or set aside for that purpose. Upon 
a reduction of the capital or the winding up of the trust as in 
the Agreement and Declaration of Trust provided, they shall be 
entitled to share pro rata in the principal of the trust estate. 
The holders of common share certificates shall be entitled to vote 
at shareholders' meetings, either in person or by proxy, casting 
one vote for each share. 

No shareholder of either class shall have any title, estate or 
ownership in the property held by the trustees and no right 
to interfere with the management thereof by the trustees, but 
the absolute title to all property in the trust estate shall be in' 
the trustees, and they shall have the sole power to manage the 
same. The only interest of any shareholder shall be to receive 
the cash distributions hereinabove mentioned, payable at the dis- 
cretion of the trustees, pursuant to the terms of the agreement 



928 MORRISON'S OIL RIGHTS 

and declaration of trust. No shareholder shall be liable in any 
manner for the debts or default of the trustees in the manage- 
ment of the trust estate or otherwise, nor shall he be subjected 
to any such liability by any action of the shareholders. Neither 
shall any shareholder be subject to assessment on account of such 
interest. 

The trust created by said Agreement and Declaration of Trust 
may be terminated by the shareholders at any time as in said 
instrument provided, and shall in any case terminate on or be- 
fore October 1, 1934. 

This certificate and the interest represented thereby consti- 
tutes personal property and is transferable by assignment, but 
no assignment hereof shall affect the trustees to their prejudice 
until this certificate with proper evidence of the transfer of in- 
terest shall be surrendered to the trustees for cancellation and 
a new certificate demanded. 

The trustees will at all time maintain an office in the City of 
Grinnell, State of Iowa, for issuing and transferring shares, and 
they may maintain offices elsewhere at their discretion. 

In witness whereof the trustees have hereunto subscribed 
the name of the The Grinnell Texas Company and their names at 

the City of Grinnell in the State of Iowa, this day 

of ,19 

THE GRINNELL TEXAS COMPANY 
By 

Trustees. 



ENDORSEMENT 

For value received hereby sell, assign and 

transfer unto * (preferred or 

common) shares in The Grinnell Texas Company represented 

by the within certificate and hereby authorize the 

transfer of said shares on the books of said company. 

Witness my hand this day of , 

19 In the Presence of 



FORMS 929 

In addition to the foregoing, preferred share certificates shall 
have the word "Preferred" printed plainly upon the face and the 
hack thereof, and the common share certificates shall have the 
word "Common" so printed thereon. The opening sentence of 
each Certificate shall plainly state the class of shares which it 
represents. 

Fourteenth. Whenever the trustees in their judgment believe 
that they can advantageously use more capital in the manage- 
ment of the trust business, they may solicit contributions on the 
terms herein provided, or they may borrow money, or purchase 
property upon credit or otherwise obligate the trust estate. 
Also, whenever they deem it for the best interests of the estate, 
they may refuse to accept contributions, or may reduce the 
amount of capital in their hands by discharging the debts of the 
trust estate or by retiring preferred shares or making payments 
thereon, or by paying dividends on common shares, provided the 
preferred shares have been first retired. The trustees may, if 
they deem it for the best interests of the trust estate, borrow 
money to retire preferred shares, or they may issue shares for 
the purpose of raising funds to discharge debts. 

Fifteenth. The trustees shall on or before October 1, 1934, 
but not earlier than January 1, 1933, unless so ordered by a 
vote of two-thirds of the outstanding common shares, convert 
all the property in the trust estate into cash, discharge the 
debts,- retire the preferred shares and distribute the balance 
among the holders of the common shares, thereby winding up 
the trust. At any time the shareholders may at an annual or 
special meeting, by a vote of two-thirds of the common shares 
outstanding, order the trustees to proceed to wind up the trust 
in the manner aforesaid with all reasonable dispatch provided 
such proposed action was stated in the notice of the meeting. 

Sixteenth. Preferred shareholders shall not be entitled to vote 
such shares at shareholders' meetings, but holders of common 
shares shall be entitled to one vote for each common share held, 
which vote may be cast by the shareholder in person or by 
proxy. To constitute a quorum for the transaction of business 
at any shareholders' meeting, it shall be necessary that two- 
thirds of the common shares outstanding at the time shall be 
M. 0. R— 50, 



930 MORRISON'S OIL RIGHTS 

represented and a majority of the shares so represented shall 
determine the action of the meeting unless a larger proportion 
is required by this instrument. Less than a quorum may ad- 
journ a properly called meeting from time to time, but not to 
exceed ten days at one time, until the presence of a quorum 
may be obtained. 

Seventeenth. The trustees may make, adopt, amend or repeal 
such by-laws, rules and regulations not inconsistent with the 
terms of this instrument as they shall deem necessary or de- 
sirable for the conduct of their business and for the government 
of themselves, their agents, servants and representatives. 

Eighteenth. The trustees shall not be liable for any error of 
judgment or for any loss arising out of any act or omission in 
the execution of this trust so long as they act in good faith, nor 
shall they be personally liable for the acts or omissions of each 
other or for the acts or omissions of any officer, agent or servant 
elected or appointed by or acting for them. The trustee shall 
fix the compensation, if any, of all officers and agents whom they 
may elect or appoint and may also pay to themselves reasonable 
compensation for their services. They shall keep a share-book 
with stubs showing the number of each certificate, the name and 
address of the person to whom the same is issued, the number of 
shares represented thereby, the consideration for each original 
issue, and in case of transfers, the number or numbers of the 
certificate or certificates cancelled which enter into the new cer- 
tificate. Whenever a certificate is cancelled the cancellation 
shall be written or stamped or perforated upon the face of the 
certificate, and the stub shall show the number of the certificate 
or certificates by which the shares have been reissued. The 
stub shall also show the amount of all dividends paid on the 
certificate, the date of such payment, and, upon retirement of 
any shares, the stub of the last certificate shall show the fact 
and date of such retirement. The trustees shall also keep a 
share ledger and proper account books, the latter showing a 
complete inventory of all the property held under the trust with 
its original cost, the expense of all improvements placed upon 
the real estate, and the original cost and expense of the mainte- 
nance of all dikes, ditches and other works. It shall .not be neces- 



FORMS 931 

sary for the trustees to hold formal meetings or to take any 
action by motion or resolution, but they shall keep the minutes 
of all their important transactions. They shall also preserve 
the minutes of the shareholders' meetings as hereinabove pro- 
vided. They shall also keep copies of all contracts and written 
agreements entered into by them on behalf of the trust. Each 
and every one of the above mentioned books, records and papers 
shall belong to the trust estate, and at the time of the selection 
of new trustees shall be delivered by the retiring to the incoming 
trustees. 

Nineteenth. No action of the trustees in dealing with strangers 
to the trust, shall be held to be invalid or outside of their powers 
as trustees, to the prejudice of any such stranger, provided, he 
has dealt with the trustees in good faith ; and no person dealing 
with the trustees shall be bound to see to the application of the 
purchase money or other consideration paid or delivered by or 
for him to or for the trustees. 

Twentieth. Trustees may be elected or appointed from the 
body of the shareholders or otherwise, and any trustee may ac- 
quire, own and dispose of shares in this trust as freely as if he 
were not a trustee. 

Twenty-first. Any decision of the trustees made in good faith 
as to what constitutes income of the trust estate and what con- 
stitutes principal, shall be conclusive upon all persons interested 
therein. Whenever the trustees desire to pay any dividend on 
the principal of the preferred shares, less than the entire face 
value of all outstanding preferred shares, they may determine 
the number of shares which can be retired by the amount of 
money which they deem best to appropriate for that purpose, 
and draw by lot such number of shares from the total number 
of shares outstanding, which shares so drawn shall be retired; 
or they may invite bids from the holders of preferred shares 
and apply the money, so far as it will go, in retiring the shares 
of the lowest bidders ; or they may declare a dividend upon the 
preferred shares equally. 

Twenty-second. In case of the loss of destruction of any cer- 
tificate for shares, the trustees may, upon such conditions as 



932 MORRISON'S OIL RIGHTS 

they deem expedient, issue a duplicate certificate or certificates 
in place of the one lost or destroyed. 

T iv enty -third. The fiscal year of the trustees shall commence 
on January first and end on December thirty-first of each year. 

Twenty -fourth. The death' of a shareholder under this trust 
shall not affect the continuance of the trust, nor shall it entitle 
the representatives of the deceased shareholder to an accounting, 
or to take any action in the Courts or elsewhere against the 
trustees, but the heirs, executors, administrators, or assigns of 
any deceased shareholder shall succeed to the rights of such 
decedent under this trust as personal property, upon surrender 
of the certificate for cancellation with due proof of the succes- 
sion of the holder. 

Twenty --fifth. The trustees shall have no power to bind the 
shareholders personally, nor to call upon them for the payment 
of any sum of money or any assessment whatever, other than 
such sums as each holder may at any time for himself agree to 
pay by way of subscription to new shares or otherwise. 

Twenty -sixth. All persons extending credit to or contracting 
with or having any claim against the trustees shall look only to 
the funds and property of the trust estate for the payment of 
such contract or claim or for the payment of any debt, damage, 
judgment, or decree, or of any money that may otherwise become 
due. or payable to them from the trustees ; so that neither the 
trustees nor any of them, nor any shareholder present or future 
shall be personally liable therefor. In every order, contract or 
obligation which the trustees shall execute, authorize or enter 
into, it shall be their duty to stipulate or cause to be stipulated 
that neither the trustees nor the shareholders nor any of them 
shall be held to any personal liability under or by reason of such 
order, contract or obligation, and that only the trust estate shall 
be bound therefor. However, the failure to make such stipula- 
tion shall not be deemed to subject the trustees or the share- 
holders or any of them to personal liability.' 

Twenty -seventh. It is further expressly provided and declared 
that in case any trustee or shareholder shall at any time for 
any reason be held to, or be under, any personal liability as such 
trustee or shareholder, not due to his acts in bad faith, then 



FORMS 933 

such trusteo or shareholder shall be held harmless and indemni- 
fied out of the trust estate for any and all loss, cost, damage 
or expense by reason of such liability, and if at any time the 
trust estate shall be insufficient to provide for such indemnity 
and to satisfy all liabilities of and claims against it, then the 
trust estate shall, in preference and priority over any and all 
other claims or losses whatsoever, except claims having a priority 
guaranteed By law, be applied first to the indemnification of the 
trustees from any loss, cost, damage or expense in connection 
with any personal liability which they may be under or have in- 
curred, except as aforesaid, and thereafter, to the indemnifica- 
tion in like manner of the shareholders. 

Twenty-eighth. This Agreement and Declaration of Trust 
may be amended or altered in any particular whatsoever, except 
as regards the exemption from personal liability and the in- 
demnification of the trustees and shareholders, and except as 
regards the priorities of the preferred shares, at any annual or 
special meeting of the shareholders, with the consent of the 
holders of at least two-thirds of the common shares then out- 
standing, provided notice of the proposed amendment or altera- 
tion shall have been given in the call for the meeting; and in 
case of such alteration or amendment, the same shall thereupon 
become a part of this Agreement and Declaration of Trust, and 
a copy thereof shall be recorded in the office of the Recorder in 
every county in which this Declaration of Trust shall have been 
recorded, and shall be deposited with the custodian of every 
copy of this instrument for inspection by the shareholders or 
other persons having any interest therein. 

Twenty-ninth. A duplicate original of this Agreement and 
Declaration of Trust shall, immediately after its execution, be 
deposited with The Grinnell Savings Bank in the City of Grin- 
nell, Iowa, for inspection by any shareholder or other person in- 
terested in this trust, but the trustees shall have power at any 
time to change the depository with which such duplicate origi- 
nal is deposited, provided it shall at all times be kept on de- 
posit for the purpose aforesaid with some bank or trust company 
in said City of Grinnell. 

Thirtieth. The record books, account books and papers of the 



934 MORRISON'S OIL RIGHTS 

trustees shall not be open to examination by the shareholders or 
any of them without the consent of the trustees, except at the 
time of the annual meeting, or pursuant to a resolution adopted 
by the shareholders at an annual or special meeting'; but the 
trustees shall comply with all such requirements in that regard 
as may be imposed by the shareholders at such meetings. 

Thirty-first. All trustees shall be bound by the acts of their 
predecessors so far as the trust estate is concerned, and shall 
have no power to invalidate contracts or repudiate responsibility 
for acts of their predecessors in office, except where the person 
dealing with such predecessors has acted in bad faith. 

Thirty -second. The trustees shall assume and pay all costs 
and expenses connected with the creation of this trust, and the 
procuring of contributions thereto prior to its creation, and 
shall assume and pay out of the funds of the trust estate the 
following notes of parties of the first part, to-wit : 

To The Grinnell Savings Bank for $1,500.00, dated August 

13, 1914, due December 13, 1914. 

To David C. Peck for $1,000.00, dated September 5, 1914, due 
March 5, 1915. 

To The Grinnell Savings Bank for $1,000.00, dated October 

14, 1914, due April 14, 1915. 

Thirty-third. Parties of the first part covenant with the par- 
ties of the second part and with all persons who may hereinafter 
become shareholders under this agreement, and with the parties 
of the third part and their successors in trust that they, the said 
parties of the first part, are the owners of the following de- 
scribed interests in real estate in the State of Texas, subject only 
to the liens, encumbrances and obligations mentioned in connec- 
tion therewith, to-wit: 

Descriptions of Lands Omitted 

The said above described lands and the lands more particu- 
larly described in the contracts of record as aforesaid aggregat- 
ing thirty-eight hundred (3,800) acres, more or less. 

Thirty -fourth. Parties of the first part further covenant and 
agree to sell, assign, convey and transfer all their interest in 
said real estate to parties of the third part and the survivor 






FORMS 935 

of them and the heirs and assigns of such survivor, subject to 
the defeasance hereinabove mentioned, in trust under this agree- 
ment, and therewith to sell and deliver to said trustees and their 
said successors all of the surveys, maps, plats, plans, profiles, 
charts and opinions which they have had made of or respecting 
said lands and the necessary dikes, ditches and works for re- 
claiming the same at a valuation of $12,000.00 to be paid by the 
issuance to them of one hundred twenty (120) preferred shares 
in the trust estate of THE GRINNELL TEXAS COMPANY 
as above specified, and two hundred forty (240) common shares 
in said estate, and the right to receive one common share for 
every preferred share issued to any other person under this 
agreement. And they represent and covenant that they have 
expended in excess of the sum of $4,000.00 in cash, in addition 
to the notes hereinabove assumed by the Trustees, in acquiring 
said interests in said real estate and in procuring such surveys, 
maps, plats, plans, profiles, charts and opinions, and in investi- 
gating and arranging for the development of said land in addi- 
tion to the entire time of party of the first part, L. L. Harris 
and a great amount of the time of the party of the first part, 
Samuel H. Crosby, valued at Eight Thousand Dollars ($8,000- 
00) during a period of two years, and that in their opinion said 
Icincls when brought under the single control and management 
of one person or association of persons as a drainage unit, to- 
gether with the plans which they have developed for the recla- 
mation thereof, are worth in excess of the sum of $75,000.00. 

Thirty-fifth. Parties of the third part agree to accept the 
office of interim trustees under this agreement ; to accept a con- 
veyance of the above described real estate, surveys, maps, plats, 
plans, profiles, charts and opinions, from parties of the first 
part ; to issue to parties of' the first part in consideration there- 
for certificates for one hundred twenty (120) preferred shares 
and two hundred forty (240) common shares in The Grinnell 
Texas Company; to receive the contributions of parties of the 
second part ; and to issue to them therefor certificates for one 
preferred share and one common share for each $100.00 in cash 
contributed by them; to issue to parties of the first part one 
common share for each preferred share issued to parties of the 



936 MORRISON'S OIL RIGHTS 

second part, and to issue to parties of the first part one common 
share for each preferred share issued thereafter; and in all 
other respects to carry out and perform the duties and obliga- 
tions imposed upon them by this agreement and declaration of 
trust. 

Thirty-six. The covenants and agreements of each and every 
party hereto herein contained, are made in consideration of the 
covenants and agreements of each and every other party to 
this Agreement and Declaration of Trust. 

Thirty -seventh. It shall not be necessary for the trustees to 
record this instrument or any amendment thereto, or any certif- 
icate, acceptance or other instrument herein mentioned, until 
such time as they shall deem it to be for the best interest of the 
shareholders to do so, but all such amendments, certificates, 
acceptances and other instruments provided for herein to be 
recorded, shall be duly executed and deposited with the bank 
or trust company in the City of Grinnell, Iowa, which is or may 
be designated as the depository of this instrument, and such 
papers shall be kept with this instrument until the trustees 
shall deem it best to have them recorded ; whereupon they shall 
all be filed for record as herein elsewhere provided. Thereafter 
all such amendments, certificates, acceptances or other instru- 
ments provided for herein shall be promptly recorded. 

In Witness Whereof the parties above named have executed 
this instrument in duplicate under their hands and seals in the 
City of Grinnell, County of Poweshiek and State of Iowa, this 
first day of December, 1914, as of the date first above written. 

Samuel H. Crosby. [seal] 

L. L. Harris. [seal] 

Parties of the First Part. 
J. H. T. Main. ' [seal] 

Evan S. Evans. [seal] 

Parties of the Second Part. 
William T. Moyle [seal] 

Samuel J. Pooley [seal] 

Parties of the Third Part. 



FORMS 937 

STATE OF IOWA, ) 

POWESHIEK COUNTY] 

I, H. W. Somers, a Notary Public in and for the County of 
Poweshiek and State of Iowa, do hereby certify that the above 
named Samuel H. Crosby, J. II. T. Main, Evan S. Evans, Wil- 
liam T. Moyle and Samuel J. Pooley, who are personally known 
to me and known to me to be the persons whose names are 
subscribed to the above and foregoing instrument, appeared 
before me this day personally within the county and state afore- 
said, and acknowledged, each for himself, that he signed, sealed 
and delivered said instrument as his free and voluntary act and 
deed for the uses and purposes therein set forth. 

My notarial commission expires July 4, 1915. 

Witness my hand and notarial seal this 16th day of December, 
1914. 

H. W. Somers, 
[seal] Notary Public in and for said County and State. 



STATE OF TEXAS, ) 

COUNTY OF JEFFERSON.] 

I, J. S. Edwards, a Notary Public in and for said County and 
State, do hereby certify that the above named L. L. Harris who 
is personally known to me, and is known to me to be the person 
whose name is subscribed to the above and foregoing instrument, 
appeared before me this day personally within the County and 
State aforesaid and acknowledged that he signed, sealed and 
delivered said instrument as his free and voluntary act and deed 
for the uses and purposes therein set forth. 

My notarial commission expires June 2, 1915. 

Witness my hand and notarial seal this 23d day of November, 
1914. 

J. S. Edwards, 
[seal] Notary Public in and for said County and State. 



938 MORRISON'S OIL RIGHTS 

The second form of agreement, given below, shows careful 
preparation for a trust running from the grantor to himself as 
trustee for the benefit of all beneficiaries who may thereafter 
purchase shares. We have been unable to ascertain who pre- 
pared the form, but it is concise. If the details found in the 
first form given are not essential to the terms of the Trust to 
be created, the following form should answer in ordinary cases. 

AGREEMENT AND DECLARATION OF TRUST OP 
INGRAM PRODUCTION COMPANY. 



STATE OP TEXAS, 
COUNTY OP WICHITA. ' 



This Agreement and Declaration of Trust, Made in the 
City of Wichita Falls, the State of Texas, U. S. A., this Tenth 
(10th) day of March, A. D. 1920, by Edwin L. Ingram, estab- 
lishing a Trust Estate and defining the interest, rights and duties 
of the holders from time to time of Trust Estate Shares to be 
issued hereunder, together with their assigns, hereafter called 
"Subscribers," and himself, together with his successors, here- 
inafter called "Trustee," witnesseth: 

That, Whereas, The said Edwin L. Ingram, for the purpose 
of acquiring, operating and disposing of real and personal prop- 
erty, as Trustee, under the designation of "Ingram Production 
Company," proposes to issue negotiable Certificates to the extent 
of Four Million (4,000,000) Common Shares of the expressed 
value of Five Dollars ($5.00) each, and one Million (1,000,000) 
Preferred Shares of the expressed value of One Hundred Dollars 
($100.00) each in the beneficial interest of the Trust Estate 
hereby established; it being hereby provided that said shares 
may be issued unto the Subscribers either for cash or by sale and 
conveyance by them unto the Trustee of real and personal prop- 
erty, contracts, services rendered, or other valuable rights and 
things for the uses, purposes and benefit of this Trust, and there- 
by become and be fully paid-up and non-assessable; which 
Shares shall define the interest of the Subscribers and their 
assigns in such property; which property shall be, detailed and 



FORMS 939 

described in "Schedule A" on the books of the Trustee, and the 
judgment of the Trustee regarding the value of the property 
acquired or service rendered shall be conclusive. 

Now Therefore, The said Edwin L. Ingram, as Trustee, 
hereby Declares that he will hold said property to be conveyed 
unto him, as well as all other property he may afterwards ac- 
quire as Trustee, together with the proceeds and profits thereof, 
In Trust ; that he will engage such property and funds to such 
business pursuits as he shall deem most advantageous to his 
Trust ; to manage, control, operate and dispose of the same in 
any part of the world for the benefit of the holders from time 
to time of Certificates for Shares issued hereunder according to 
the priorities expressed in said Certificates and in the manner 
and subject to the stipulations herein contained, to-wit: 

First 

(a) The Legal Title of the Trustee shall be "Trustee of In- 
gram Production Company," and all property so designated 
shall be construed as belonging to this trust. 

(b) In executing all instruments, in writing, the Trustee shall 
sign "Ingram Production Company," and thereunder sign his 
own name, either above or before the word Trustee. 

Second 

(a) The Trustee shall hold the legal title to all property at 
any time belonging to his Trust, and shall have and exercise the 
exclusive management and control of the same ; he shall assume 
all contracts, obligations and liabilities in connection with or 
growing out of the property conveyed unto him, and the man- 
agement of the same in the business of his Trust as hereinbefore 
specified, and to the extent and value of such property, But Not 
PersoNx\lly; shall agree to hold the Subscribers and their as- 
signs, and any person associated or acting with him, harmless 
and indemnified from «and against any loss, cost, obligation or 
liability by reason of or in connection with such contract, ob- 
ligation or liability; he may adopt and use a Common Seal; he 
ma} 7 sue for, receive and receipt for all moneys at any time com- 



940 MORRISON'S OIL RIGHTS 

ing due to his Trust ; he may employ counsel to begin, prosecute, 
defend or settle suits at law, in equity or otherwise ; he may pur- 
chase, lease, option, contract for, locate or otherwise acquire, own, 
hold, improve, operate, lease, option, grant, mortgage, pledge, 
hypothecate, redeem, sell or otherwise deal in and dispose of 
such real and personal property as he shall deem most advan- 
tageous to his Trust; he may advertise and exploit the goods, 
wares, merchandise, properties and methods of his Trust; he 
may accept and extend credit, borrow and loan money, issue 
Notes, Bonds, Debentures, Certificates of Interest or other evi- 
dences of indebtedness, and may secure the payment thereof by 
mortgage, pledge of property, deed of trust or otherwise, for 
such amounts and for such periods of time as he may deem 
necessary for purposes incidental to the proper carrying out of 
his Trust, and in general, may do and perform such other acts 
and things, and transact such other business, not inconsistent 
with the terms of this instrument or general law either alone or 
in conjunction with others, as he from time to time may deem 
best for the benefit of his Trust. 

(b) So far as strangers to this Trust are concerned, a resolu- 
tion by the Trustee authorizing a particular act or thing to be 
done, shall be conclusive evidence in favor of such strangers 
that such act is within the powers of the Trustee, and no pur- 
chaser from the Trustee, or one loaning money to the Trustee, 
shall be bound to see the application of the purchase money 
or the loaned money, or other consideration paid or delivered by 
or for said purchaser or loaner to or for said Trustee. 

Third 

(a) Edwin L. Ingram shall be the sole Trustee hereunder, 
and shall hold his office during the continuance of this Trust; 
provided, however, that in the event of his resignation or death 
without providing a. successor to the Trust, the Advisory Board 
shall have the right to appoint a new Trustee in accordance with 
the terms and stipulations herein contained. 

(b) As compensation for marketing the shares to be issued 
hereunder and acquiring properties for the benefit of this Trust, 
Edwin L. Ingram, personally, shall be entitled to receive Com- 



FORMS 941 

moii Shares in such amounts as shall equal ten per cent (10%) 
of the expressed value of the Shares by him disposed of, in 
which connection he shall have the right to employ brokers, 
agents, underwriters, salesmen or others to assist him in market- 
ing said Shares, and to pay them reasonable compensation for 
their services. 

(c) As compensation for administering the affairs of the 
Trust Estate, the Trustee shall be entitled to receive a salary of 
Three Hundred Dollars ($300.00) per month, together with 
such office, traveling and other expenses necessary to incur when 
performing the services and duties connected with his Trust. 

(d) The fiscal year of the Trustee shall end on the Tenth day 
of March in each year, after which date the Trustee shall submit 
his Annual Report unto the Subscribers, either in person or by 
mail to their last registered address. 

Fourth 

(a) The Trustee may make, adopt, amend, alter or repeal 
such by-laws, rules and regulations, not inconsistent with the 
•terms of this instrument, as he may deem necessary for the gov- 
ernment of himself, his agents, employees or representatives. 

(b) The Trustee may employ, engage, hire, appoint and dis- 
charge such skilled and common labor, agents, salesmen, man- 
agers, superintendents, officers, Advisory Board and Committees, 
assistants and representatives as he .may from time to time deem 
necessary to properly operate and conduct the affiairs of the 
Trust Estate, and is hereby empowered and authorized to fix 
and pay the compensation thereof. 

(c) The Trustee shall not be liable for error of judgment in 
acquiring, holding, developing, operating or disposing of any 
property for the benefit of his Trusts; nor for losses arising out 
of any investment ; nor for the acts or omissions to act performed 
or omitted by him in the execution of his Trust in good faith; 
nor shall he be liable for the acts or omissions to act of any 
employee, agent, official, Committee, Board or representatives 
employed or appointed by or acting for or with him, and he shall 
not be obliged to give bond for the due performance of his Trust. 

(d) The Trustee shall keep a complete record of the receipts 



942 MORRISON'S OIL RIGHTS 

and disbursements of all funds and property at any time belong- 
ing to his Trust, and shall furnish the Subscribers with Quarter- 
ly and Annual Reports showing the physical condition of the 
Trust Estate. 

Fifth 

(a) Common Shares hereunder shall be expressed of the value 
of Five Dollars ($5.00) each, and Preferred Shares hereunder 
shall be expressed of the value of One Hundred Dollars ($100.00) 
each. 

Preferred Shares hereunder shall entitle th,e holder thereof 
to receive cumulative dividends at the rate of tight per cent 
(8%) per annum, payable quarterly on the (10th) days of 
March, June, September and December in each year out of the 
net earnings of the Estate before any dividends are set apart or 
paid on the Common Shares, and after the two per cent (2%) 
quarterly dividends have been set apart or paid on the Preferred 
Shares, One-Third (J) of the remaining net profits shall be 
carried to the surplus fund, and the balance remaining there- 
after shall be divided equally between the Common and Pre-' 
ferred Shares and distributed among the holders thereof in pro- 
portion to their respective holdings. 

In the event of liquidation of the assets of the Estate, the pro- 
ceeds of such liquidation shall first be applied to redeeming the 
Preferred Shares at the expressed value thereof, together with 
any accrued and unpaid dividends thereon, after which the Com- 
mon Shares shall be redeemed at the expressed value thereof to 
the extent of the remaining undistributed liquidation fund, and 
the balance remaining thereafter, if any, shall be equally divided 
among the last holders thereof in proportion to their respective 
holdings. 

(b) As evidence of ownership of such Shares, the Trustee 
shall issue or cause to be issued unto each Subscriber or assigns, 
a negotiable Certificate, or Certificates, in which shall be speci- 
fied the number of Shares by him or her owned; which Certif- 
icates shall contain, in substance, the essence of the foregoing 
provisions. 

(c) In case of loss or destruction of any Certificate for Shares 



FORMS. 94o 

issued hereunder, the Trustee, under such conditions as he may 
deem expedient, may issue new Certificates in* the place of those 
lost or destroyed, but shall keep a record thereof. 

Sixth 

(a) The death of a Subscriber or Trustee during* the con- 
tinuance of this Trust shall not operate to terminate the same, 
nor shall it entitle the representative of the deceased Subscriber 
to an accounting, or to take action in the courts or elsewhere 
against the Trustee, but the Executor, Administrator or Assign 
of any deceased Subscriber under this Trust shall succeed to 
the rights of said deceased Subscriber hereunder, upon surrender 
of the Certificates for shares by him or her owned and new 
Certificates be issued. 

(b) The ownership of Shares issued hereunder shall not en- 
title the holder thereof to any individual title to the Trust Es- 
tate whatsoever or the right to call for a partition or division 
thereof, or for an accounting, or any voice or control whatso- 
ever of the Trust Property, or the management thereof, or the 
business connected therewith by the Trustee. 

Seventh 

(a) The Trustee shall have no power to bind the Subscribers 
personally, and the Subscribers and their assigns, and all firms, 
corporations, individuals or others extending credit to him, con- 
tracting with, or having any claim against the Trustee, shall 
look only to the property and funds of the Trust for the pay- 
ment of any debt, damage, judgment, decree or of any money 
that may otherwise become due and payable unto them from 
tlie Trustee, so that neither the Trustee or the Subscribers, pres- 
ent or future, shall ever become personally liable therefor. 

(b) In every written order, contract or obligation which the 
Trustee shall give or enter into, it shall be his duty to stipulate 
therein that neither the Subscribers nor the Trustee shall be 
held to any personal liability under or by reason of such con- 
tract, order or obligation. 



944 MORRISON'S OIL RIGHTS 



Eighth 



This Agreement and Declaration of Trust shall continue 
in force until terminated by the said Edwin L. Ingram, his suc- 
cessors, administrators, executor, or assigns, by liquidating- the 
assets of the Trust Estate and distributing the proceeds thereof 
among the then holders of shares issued hereunder, as herein- 
before provided; provided, however, that the duration of this 
Trust shall in no event continue for a period of time extending 
beyond twenty-one (21) years from the date of the death of the 
said Edwin L. Ingram. 

In Witness Whereof, The said Edwin L. Ingram has here- 
unto 'set his hand and seal in token of his acceptance of the 
Trust hereinbefore specified, and in further token of his assent 
to and approval of the terms of said Trust, the day and year first 
above written. 

Edwin L. Ingram. 
[seal] 

STATE OF TEXAS, ) 
COUNTY OP WICHITA. J 

Before me, the undersigned authority, on this day personally 
appeared Edwin L. Ingram, to me known to be the person whose 
name is subscribed to the foregoing instrument, and acknowl- 
edged to me that he executed the same for the purposes and 
consideration therein stated and in the capacity expressed. 

Given under my hand and seal of office on this the 10th day 
of March, A. D. 1920. 

Thos. G. King. 
Notary Public in and for Wichita County, Texas.. 



FORMS OF DRILLING CONTRACTS. 

The following forms are suggested for use; the first, in cases 
where standard tools are to be used in the drilling, and the 
second where rotary drilling is to be done. 



FORMS 945 

Standard Tools Form. 

Drilling Agreement 

Memorandum of Agreement, executed in triplicate this 

day of 1919, between The Midwest 

Refining Company, hereafter called "Owner," and 

, hereafter called "Contractor" : 

WITNESSETH 

That for and in consideration of the promises and agreements 
hereinafter contained, the parties agree as follows : 

1. Contractor agrees to drill a certain well for Owner ac- 
cording to the specifications herein contained. 

2. Said well shall be located by Owner and shall be upon the 

Quarter of Section , Township . . : 

North, Range West of the 6th P. M., 

County, State of , known as , and shall be 

known and designated as well No 

3. Contractor will drill said well to the sand, 

and into said sand as deep as designated by Owner. 

4. Owner shall furnish at its expense : 

(a) A Standard derrick complete. 

(b) A Standard rig equipment complete with bull wheels, calf 
wheels, rig irons, boiler house, casing pit and sump. 

(c) All necessary cement and all casing to be set in said well, 
(d-) All fuel, water, tools, boilers, cordage and other necessary 

equipment for continuous drilling. 

5. Contractor shall furnish at his expense : 

(a) All necessary labor for rigging up, and setting of casing 
at specified depths. 

(b) All necessary labor for drilling said well. 

(c) All food and sustenance for said labor, and a suitable 
camp for properly caring for all men working upon said well. 

6. Contractor shall: 

(a) Shut off water sand with inch casing, and 

sand with inch casing. 

M. 0. R.— 60. 



946 MORRISONS OIL RIGHTS 

(b) Carry inch casing to depth designated by Owner, 

but not to exceed feet. 

(c) Penetrate sand with inch casing to 

depth designated by Owner. 

(d) Not use smaller than inch casing without express 

permission of Owner to reduce size of hole. 

(e) Make all casing joints tight, allow inspection and approv- 
al by Owner or its representatives, and make all strings of cas- 
ing continuous and unbroken from top to bottom thereof. 

(f ) Do all work under this contract in a thorough workman- 
like manner, and have all casing when set open to its full diame- 
ter for its entire length, enabling the passage of the next smaller 
size casing free and unobstructed throughout. 

(g) Properly shut off all oil and water sands as Owner may 
designate. 

(h) Furnish to Owner the services of Contractor's employees 
without extra charge for and in cementing the well. 

(i) Clean boilers at least once every two weeks; and if boil- 
ers are burned, make necessary repairs. 

7. Owner may at any time it sees fit, put its own men on the 
rig to satisfy itself regarding the condition of the well; and, 
if Owner is convinced that well is not in shape to be deepened, 
may withhold payments to Contractor until Contractor has 
the hole in satisfactory shape. 

8. When any string of casing is landed the same shall be 
tested by Owner, or in the presence of Owner's agents or repre- 
sentatives, or as designated by Owner, as Owner may elect ; and, 
unless Owner shall notify Contractor to the contrary within 
forty-eight (48) hours after said test, the particular string of 
casing tested shall be deemed satisfactory and accepted by Own- 
er, and same shall constitute an acceptance by Owner of the 
work completed to the depth of said string of casing. 

9. All material and equipment furnished by Owner shall be 
in good condition. Contractor shall keep and maintain the same 
in good condition at Contractor's expense, and, upon completion 
of well or discontinuance of work, said material and equipment 
shall be turned over to Owner by Contractor in as good condi- 
tion, subject, however, to ordinary wear and tear. • 



FORMS 94 i 

10. Contractor shall keep an accurate log of said well, which 
shall at all times be open to the inspection of Owner, its agents 
and representatives. A copy of said log* shall be furnished by 
Contractor to Owner each day upon request. 

11. Owner shall have the right at all times to inspect the work, 
or any part thereof, as the same progresses, and to take or check 
such measurements as owner may desire. If, however, Owner 
fails to take or check up any measurements as furnished by 
Contractor, the Contractor's measurements of depths shall be 
deemed accepted by Owner and shall be conclusive for the pur- 
poses hereof. 

12. Contractor shall pay all bills for material, labor or other- 
wise involved in or arising out of the drilling of said well, shall 
exhibit, if requested, receipted payrolls, for all labor employed, 
and shall protect and hold harmless the Owner and the lands 
herein described, from any and all liens or claims whatsoever 
arising out of the work herein contemplated. 

13. Contractor Avill fully comply with all the requirements 
of the "Workmen's Compensation Law" of Wyoming, and 
amendments thereto, and save and hold harmless the Owner from 
all loss or liability for damages sustained by persons injured, or 
the dependents of persons injured, by, through or on the work 
performed under this contract. 

14. In case the rig shall be destroyed by fire as the result of 
any negligence of the said Contractor or employees, the said 
Contractor shall replace the rig and equipment destroyed with- 
out cost to the Owner ; but if the destruction of the said rig by 
fire is occasioned by wholly accidental causes beyond the con- 
trol of the said Contractor or employees, the Owner will replace 
the said rig, but in either case the Owner shall not be liable to 
the Contractor for delay pending the re-construction of the rig. 

15. Owner will pay Contractor: 

(a) Dollars ($ ) per linear foot 

for the first feet ( feet) or part thereof, of 

hole drilled and casing set. 

(b) Dollars ($ ) per linear foot 

for the next feet ( feet) or part thereof, of 

hole drilled and casing set. 



948 MORRISON'S OIL RIGHTS 

(c) Dollars ($ ) per linear foot 

for all hole drilled beyond feet ( feet) . 

16. Payments will be made by Owner to Contractor: 

(a) Dollars ($ ) when the well 

is completed to a depth of feet ( .feet). 

(b) Dollars ($ ) when the well is 

completed to a depth of feet ( feet) . 

(c) Dollars ($ ) when the well is 

completed to a depth of feet ( feet) . 

(d) Dollars ($ ) when the well is 

completed and finished. 

(e) Balance on or before sixty (60) clays after completion and 
acceptance of well by Owner. 

Before making the above payments, or any of them, except 
last payment, the Owner shall be satisfied that the well is . in 
good and proper shape for further drilling. 

17. In the event that either party to this agreement fails to 
fully keep and perform each and all of the terms and agree- 
ments herein specified, then this contract may be terminated at 
the option of the party not in default and not causing the de- 
fault. If the Owner shall fail to keep and perform the terms 
and conditions of this contract, then the Owner shall pay the 
Contractor for the number of feet actually drilled at the full 
contract price per foot, or repay all money spent by the Con- 
tractor in preparing to drill said well, upon the expiration of 
Sixty \60) days from the date when the said Contractor shall 
have ceased work and elected to terminate this contract on ac- 
count of any such default of said Owner; Provided, However, 
that no mechanic's, laborer's or material-men's liens shall be filed 
or claimed within said Sixty (60) days; it being understood that 
the Contractor shall not be entitled to payment for any work or 
services performed prior to the termination of this contract un- 
til said Contractor shall have procured the discharge and release 
of all claims for liens whatsoever. 

18. If Contractor is compelled to shut down for a period in 
excess of twenty-four hours (24 hours) because of Owner's fail- 
ure to furnish fuel, water, tools, cordage or casing, Owner shall 

pay Contractor the sum of Dollars ($ ) 

per day after said first twenty-four hours (24 hours) of delay, 



FORMS 949 

so long as said shut-down shall continue; Provided, However, 
if tools are lost in the hole, or broken by Contractor or employees, 
delay and time lost in recovering or replacing- same shall be at ex- 
pense of Contractor. 

19. Owner may use Contractor's crew of men in pulling cas- 
ing, shooting the well, or any other labor on said well not em- 
braced in this contract ; and while so using Contractor's crew of 

men the Owner shall pay Contractor 

Dollars ($ ) per day therefor. 

20. While waiting for cement to set in said well, the Owner 
will furnish employment to Contractor's employees and pay them 
the same wages as Owner is paying other labor of the same 
class and character in the field at the time. 

21. If Contractor fails to faithfully keep and perform any of 
the agreements or promises herein contained, the Owner shall 
retain any and all amount or amounts due from Owner to Con- 
tractor as liquidated damages incurred by Owner by reason of 
Contractor's breach of this agreement. 

22. Neither Owner nor Contractor shall be liable for any delay 
or damage due, occasioned or caused by strikes, action of the 
elements or causes beyond control of the parties ; and any delay 
due to above causes, or either of them, shall not be deemed a 
breach of or failure to perform this agreement or any part here- 
of. 

23. For the purpose of performing this contract, the Con- 
tractor, his agents, emploj^ees and representatives, shall at all 
times have free access to said property during the progress and 
continuation of the work. 

24. Contractor shall not assign this contract without the ex- 
press consent of the Owner. 

In Witness Whereof, the parties have executed this Memo- 
randum of Agreement the day and year first above written. 
The Midwest Refining Company 

By • 

General Superintendent Owner. 

Contractor. 

Witness : 



950 morrison's oil rights 

Rotary Form 

Drilling Agreement 

Memorandum of Agreement, executed in triplicate this 
day of , 19 .... , between The Midwest Refin- 
ing Company, hereafter called "Owner," and , 

hereafter called "Contractor :" 

WITNESSETH 

That for and in consideration of the promises and agreements 
hereinafter contained, the parties agree as follows : 

1. Contractor agrees to drill a certain well for Owner accord- 
ing to the specifications herein contained. 

2. Said well shall be located by Owner and shall be upon the 

Quarter of Section , Township 

North, Range West of the 6th P. M., 

County, State of , known as , and 

shall be known and designated as well No 

3. Said well to be drilled to depth designated by Owner, but 
not to exceed feet. 

4. Owner shall furnish at its expense : 

(a) A complete derrick suitable and adaptable for rotary 
drilling purposes. 

(b) A complete rig equipment for rotary drilling. 

(c) Boilers aggregating 120 Horse Power. 

(d) Fuel and Water, and light equipment. 

(e) All casing to be used and set in said well. 

(f) Sufficient material to properly construct rotary founda^ 
tions, runways, head boards, finger boards in derrick, engine 
foundation and slush pits. 

(g) All cement and cementing equipment. 

5. Contractor shall furnish at his expense : 

(a) All rotary equipment and machinery. 

(b) All pipe, tool joints, pumps, rotary drilling line, fishing 
tools, rotary engine and all necessary material not expressly 
specified to be furnished by Owner. 



FORMS 951 

(c) All necessary labor for the drilling of said well, and the 
setting of the casing therein at specified depths. 

(d) All labor and expense setting up rotary machinery, and 
for breaking down drill pipe after well is completed. 

(e) All food and sustenance for said labor, and a suitable 
camp for properly caring for all men working upon said well. 

6. Contractor shall inspect and approve said derrick, rig, 
boilers, connections, equipment and material furnished by Own- 
er before placing machinery upon said derrick preparatory to 
commencing drilling operations. 

7. Contractor shall: 

(a) Dig slush pits and construct mud troughs. 

(b) Haul all material belonging to or furnished by Contract- 
or. 

(c) Set up and connect boilers. 

(d) Clean boilers every two weeks, and if boilers are burned, 
Contractor to make repairs. 

(e) Set a string of 8J-inch casing from the top to depth desig- 
nated by Owner's Field Superintendent (approximately 2500 
feet), but not to a greater depth than 2700 feet. 

(f) Make all casing joints tight, allow inspection by Owner 
or its representatives ; and make all strings of casing continuous 
and unbroken from top to bottom thereof when finally landed, 
with proper circulation around same for cementing should Own- 
er desire to cement same. 

(g) Furnish to Owner, without extra charge, the services of 
Contractor's Equipment and employees to cement well, which 
shall be done under Owner's supervision. 

(h) Do all work under this contract in a thorough workman- 
like manner, and have all casing when set open to its full diam- 
eter for its entire length, enabling the passage of the next 
smaller size casing free and unobstructed throughout. The test 
of passing through said casing the next smaller size casing shall 
be made after the setting of each string of casing, and before 
the well is "bailed down," provided the Owner requires said test. 
If the Owner does not properly inspect each of said strings of 
casing or require a test to be made thereof, the Owner thereby 
agrees said well to have been satisfactorily drilled and in prop- 



952 MORRISON'S OIL RIGHTS 

er condition to the respective depths of each of said strings of 
casing. 

8. If said casing shall be damaged or collapse because of "bail- 
ing down" of fluid in the well under instructions of Owner, the 
Owner shall bear said damage and the Contractor not be liable. 

9. When any string of casing is landed the same shall be tested 
by Owner, or in the presence of Owner's agents or representa- 
tives, or as designated by Owner, as Owner may elect; and, un- 
less Owner shall notify Contractor to the contrary within forty- 
eight hours (48 hours) after said test, the particular string of 
casing tested shall be deemed satisfactory and accepted by Own- 
er, and same shall constitute an acceptance by Owner of the 
work completed to the depth of said string of casing. 

10. If for any reason Contractor is unable to complete said 
well No as herein provided, Contractor shall imme- 
diately commence a new well at a point not more than 40 feet 
distant from the location of said well No , and the drill- 
ing of said new well shall be done according to the specifications 
and agreements herein contained; Provided, however, said new 

well shall be drilled to the depth at which said well No 

was wmen lost, the Contractor bearing all expense of moving der- 
rick and rig, excavating new pits, providing new connections, 
foundations and all work and material necessary for proper erec- 
tion of rig and derrick ; and furnish fuel, water, labor and lights 
in order that new well shall be properly drilled to the depth of 
well No when lost, free of any additional cost to Owner. 

11. All material and equipment furnished by Owner shall be 
in good condition. Contractor shall keep and maintain the same 
in good condition at Contractor's expense, and, upon completion 
of well or discontinuance of work, said material and equipment 
shall be turned over to Owner by Contractor in as good condi- 
tion, subject, however, to ordinary wear and tear. 

12. Contractor shall keep an accurate log of said well, which 
shall at all times be open to the inspection of Owner, its agents 
and representatives. A copy of said log shall be furnished by 
Contractor to Owner each day upon request. 

13. Owner shall have the right at all times to inspect the work, 
or any part thereof, as the same progresses, and to take or check 



FORMS 953 

such measurements- as Owner may desire. If, however, Owner 
fails to take or check up any measurements as furnished by Con- 
tractor, the Contractor's measurements of depths shall be deemed 
accepted by Owner and shall be conclusive for the purposes here- 
of. 

14. Contractor shall pay all bills for material, labor or other- 
wise involved in or arising out of the drilling of said well ; shall 
exhibit, if requested, receipted pay rolls for all labor employed, 
and shall protect and hold harmless the Owner and the lands 
herein described from any and all liens or claims whatsoever 
arising out of the work herein contemplated. 

15. Contractor will fully comply with all the requirements 
of the "Workmen's Compensation Law" of Wyoming, and 
amendments thereto, and save and hold harmless the Owner 
from all loss or liability for damages sustained by persons in- 
jured, or the dependents of persons injured, by, through or on 
the work performed under this contract. 

16. Contractor will submit a correct, up-to-date, itemized 
(hole made, warehouse charges, board bills, etc.) statement of 
expense on the first day of each month. This statement Con- 
tractor will send to office of Owner at Casper, Wyoming. 

17. Owner will pay Contractor : 

(a) Dollars ($ ) per linear foot for 

each and every foot of hole drilled and casing set to a depth of 
approximately ......... feet, or to the sand. 

(b) Dollars ($ ) per linear foot for 

each and every foot of hole drilled and casing set from said 
above mentioned depth, or sand, to the depth at which said hole 
is completed or drilling stopped by order of Owner. 

18. Payments will be made by Owner to Contractor : 

(a) ($ ) per foot on the fifteenth day 

of each month for actual number of feet of hole drilled by Con- 
tractor during preceding calendar month. 

(b) Balance on or before 60 days after well is completed. 

19. In the event that either party to this agreement fails to 
fully keep and perform each and all of the terms and agreements 
herein specified, then this contract may be terminated at the 
option of the party not in default and not causing the default. 



954 MORRISON'S OIL RIGHTS 

If the Ojvner shall fail to keep and perform the terms and con- 
ditions of this contract, then the Owner shall pay the Contractor 
for the number of feet actually drilled at the full contract price 
per foot, or repay all money spent by the Contractor in prepar- 
ing' to drill said well, upon the expiration of Sixty (60) days 
from the date when the said Contractor shall have ceased work 
and elected to terminate this contract on account of any such 
default of said Owner; provided, however, that no mechanic's, 
laborer's or materialmen's liens shall be filed or claimed within 
said sixty (60) days; it being understood that the Contractor 
shall not be entitled to payment for any work or services per- 
formed prior to the termination of this contract until said Con- 
tractor shall have procured the discharge and release of all 
claims for liens whatsoever. 

20. If Contractor fails to faithfully keep and perform any of 
the agreements or promises herein contained, the Owner shall 
retain any and all amount or amounts due from Owner to Con- 
tractor as liquidated damages incurred by Owner by reason of 
Contractor's breach of this agreement. 

21. If Contractor is compelled to shut 'down for a period .in 
excess of twenty-four (24) hours because of Owner's failure to 
furnish fuel, water, or casing, Owner shall pay Contractor the 

sum of Dollars ($ ) per day after said first 

twenty-four (24) hours of delay, so long as said shut-down shall 
continue. 

22. If derrick or rig or any part of equipment furnished by 
Owner to Contractor be damaged or destroyed by fire, Contract- 
or at his expense will replace such derrick, rig, equipment or 
part thereof, unless such destruction or damage was caused by 
Owner or its agents or representatives. 

23. Owner shall not accept said well, or make final payment 
thereon, until Owner's representatives shall have an opportunity 
to run tools in the hole to ascertain if said hole is free from iron. 

24. Neither Owner nor Contractor shall be liable for any delay 
or damage due, occasioned or caused by strikes, action of the 
elements or causes beyond control of the parties ; and any delay 
due to above causes, or either of them, shall not be deemed a 



FORMS V5o 

breach of or failure to perforin this agreement or any part there- 
of. 

25. For the purpose of performing this contract, the Contrac- 
tor, his agents, employees and representatives, shall at all times 
have free access to said property during the progress and con- 
tinuation of the work. 

26. Contractor shall not assign this contract without the ex- 
press consent of the Owner. 

In Witness Whereof, the parties have executed this Memo- 
randum of agreement the day and year first above written. 
The Midwest Refining Company. 

By 

General Superintendent, Owner. 
Witnesses : 



Contractor. 



FORM OF ASSIGNMENT OF LEASE 

Know All Men By These Presents, That I, Colin Monag- 
han, of Denver, State of Colorado, the lessee in a certain inden- 
ture of lease dated the second day of February, A. D. 1920, from 
Silver Tabor, of Leadville, said State, demising certain lands 
situate in Carbon County, State of Wyoming, to-wit; the North 
half of the Northeast Quarter of Section fourteen, Township 
Seven, South Range Sixty-one West of the Sixth Principal Meri- 
dian, for the term of one year and so long thereafter as oil and 
gas are found upon said premises in paying quantity, do hereby 
sell, assign, transfer and set over to Albert B. Hunter, of said 
County of Carbon and State of Wyoming, all my estate, right, 
title and interest in and to said lease and said premises therein 
demised. 

The consideration to be paid for this assignment is jihe sum 
of Ten thousand Dollars, of which the sum of Five thousand 
Dollars has this day been paid and its receipt is hereby acknowl- 
edged, and the remaining Five thousand Dollars is to be paid 
within thirty days from date hereof at the International Trust 



956 MORRISON'S OIL RIGHTS 

Company, of Denver, Colorado, which bank will, upon said final 
payment being made, make delivery hereof to said Albert B. 
Hunter or his order. 

In Witness Whereof, I have hereunto set my hand and seal 
this twenty-first day of June A. D. 1920. 

Colin Monaghan [seal] 

The above assignment is in technical form and provides for 
escrow pending deferred payment, but any purported transfer 
in writing naming the parties, describing the lease and the land 
leased by it and expressing a consideration would be valid. And 
if the parties and consideration are expressed, nothing further 
is absolutely essential, if there is enough in the assignment to 
identify the lease intended to be set over. 

Assignment of Option. 

A personal option or offer to sell not yet acted on is not as- 
signable. Reuse v. Kettle, 49 S. E. 150. 

And where the option runs to heirs and assigns the first as- 
signee has no power to transfer to second assignee. Wheeling 
Creek Gas Co. v. Elder, 170 Fed. 215. 

An option where it runs to heirs and assigns is assignable. 
Landon v. Moreliead, 34 Okla. 701, citing many authorities 
among them Fulton v. Messinger, 61 W. Va. 477, 56 S. E. 830, 
which latter case holds that where there are no mention of assigns 
the option is personal and non-assignable. 

Federal Lease Not Assignable. 

Under the Oil and Gas Act of 1920 the form of the lease pro- 
vides that the lessee shall not assign any interest, nor sublet any 
portion of the premises without the written consent of the Secre- 
tary of the Interior. See page 346. 

For assignment, generalty, see page 106. 



GLOSSARY 



Aeroplane Oil. A white, straight-reduced viscous neutral oil having a grav- 
ity of 32|° to 34° B. } a flash-point of 415° F., a fire test of 480° F., 
a cold test of 20° F., and a viscosity of 185 to 200 Saybolt. (Bacon) 

Air Gas. A combustible gas made by saturating air with the vapor of 
some volatile hydrocarbon mixture, as gasoline, and used for light- 
ing and heating. (Webster) 

Albrecht Condenser. A condenser used in petroleum distillation, to sepa- 
rate the distillate into its various fractions. (Mitzakis) 

Alkali Test. A process by which kerosene is treated with a solution of 
caustic soda, making it purer and more suitable for illuminating. 
The kerosenes are divided into classes according to the results given 
by this alkali test and a fixed scale constructed. (Mitzakis) 

Anticlinal. Of, or pertaining to, an anticline. (Webster). The crest of 
an anticlinal roll may be the apex of a vein. (Tonopah Min. Co. v. 
West End Cons. Min. Co., 158 Pac. 881) 

Anticlinal Line or Axis. In geology, the medial line of a folded struc- 
ture from which the strata dip on either side. (Century) 

Asphalt. A complex compound of various hydrocarbons, part of which 
are oxygenated. Related in origin to petroleum. Is brown or brown- 
ish black in color, melts at 90° to 100°F., and is mostly or wholly 
soluble in turpentine. Its varieties are albertite, elaterite, gilsonite 
and grahamite. 

Asphalt-base. Asphalt-base oils contain asphalt and no paraffin. They 
are distilled to asphalt, and the distillates are cut according to grav- 
ity; such oils do not yield steam-refined cylinder stock or paraffin 
wax. It is used chiefly for fuel oil. (Bacon) 

B. 

Bedrock. The first solid formation under the usual layer of soil and de- 
bris which the drill penetrates. 

Benzine. A colorless, inflammable and volatile liquid obtained from petro- 

957 



958 MORRISON'S OIL RIGHTS 

leum by fractional distillation and consisting of various hydrocarbons. 
Called also Petroleum spirit. (Standard) 

Benzoline. 1. The more volatile portion obtained on redistilling benzine; 
boiling point about 70°-95° C. Often used as synonymous with 
Benzine. ( Bacon ) 

2. A mixturue containing hexane, heptane, octane, and other paraf- 
fins, petroleum spirit or legroin. (Standard) 

Benzoyl. The commercial name applied to a mixture of substances, includ- 
ing benzine and its homologues. (Mitzakis) 

Bitumen. See Asphalt. A general name for various solid and semisolid 
hydrocarbons. In 1912 the term was used by the American Society 
for Testing Materials to include all those hydrocarbons which are 
soluble in carbon bisulphide, whether gases, easily mobile liquids, 
viscous liquids, or solids. (U. S. Geol. Surv.) 

Bituminous. Containing much organic, or at least carbonaceous matter, 
mostly in the form of the tarry hydrocarbons which are usually de- 
scribed as bitumen. (Kemp) 

Bituminous Shale. A shale containing hydrocarbons or bituminous ma- 
terial; when rich in such substances it yields oil or gas on distilla- 
tion. Called also Pyroschist or Oil shale. (Standard) 

Borax. A crystalline sodium biborate. Xa 2 B 4 O 7 .10H 2 O. See also Tincal. 
( Dana ) 

Borehole. A hole made with a drill, auger or other tools, for exploring 
strata in search of minerals, for water supply, for blasting purposes, 
for proving the position of old workings, faults, and letting off ac- 
cumulations of gas or of water (Gresley). 

Bottom Water. In oil wells, water that lies below the productive sand, 
and is separated from it. Compare Top water; Edge water. (U. S. 
Geol. Surv. Bull, 658, p. 44) 

Bradenhead. In oil-well drilling, an iron or steel head serew»?d into the 
top of the casing. The inner pipe projects up through it and is packed 
with some pliable substance, preferably rubber. The bradenhead is 
used to confine gas between the tubing and casing, or between two 
strings of casing, and has an outlet through Avhich gas may be piped 
away. More commonly called Stuffing-box casing-head. 

Bradenhead Gas. In oil wells, natural gas inclosed or confined by a brad- 
enhead. It applies to all the gas that lies above the oil and through 
which the drill must go to reach the lower and more profitable oil 
sands. 



GLOSSARY 959 

Brown Petroleum. A natural solid, or semi-solid product produced by 
the action of air upon fluid bitumens. (Bacon) 

Broxburn Oil Shale. A Scottish shale which yields 23 to 35 gals, of crude 
oil and 35 to 40 lbs. of ammonium sulphate per ton. (Bacon) 

B. S. Oil. A term applied to crude-oil tank residues. (Bacon) 

B. T. U. An abbreviation for British thermal unit. 

c. 

Cannel Coal. A massive, noncaking, tough, clean, block coal of fine, even, 
compact grain, dull luster, commonly conchoidal cross fracture, hav- 
ing a typical low-fuel ratio, a high percentage of hydrogen, easy 
ignition, long yellow flame, black to brown greasy streak, and mod- 
erate ash, pulverulent in burning. It is essentially a rock derived by 
solidification and partial distillation or oxidation of water-laid de- 
posits consisting of or containing large quantities of plant spores and 
pollen grains and more or less comminuted remains of low orders of 
water plants and animals? (U. S. Geol. Surv. Bull. 659, p. 8) This 
word is derived from Ganwyl, meaning a candle, from the readiness 
with which the coal ignites and gives off a steady flame. (Gresley) 

Capping. The name given to a method by which the flow of a spouting 
oil well is stopped or restricted. When a very strong discharge of 
petroleum is expected, strong valves are attached to the casing, which 
permit the flow to be controlled. 

Carbide. A binary compound of carbon with some other element. (Web- 
ster) 

Carbon. An elementary substance occurring native as the diamond and 
also as graphite or black lead and forming a constituent of coal, pe-, 
troleum, asphalt, limestone and other carbonates, and all organic com- 
pounds. Symbol, C, atomic weight, 12.0. Specific gravity, 1.7 to 3.6. 
(Webster) 

Carboniferous. Bearing or carrying carbon. It usually implies that it 
carries coal. A period of geologic time and one of the paleozoic 
stratified rocks. 

Casing. An outer pipe inserted in oil wells to prevent the caving of the 
sides and to shut out water. 

Casing Cutters. Instruments used in oil fields for cutting casing prior 
to raising it to the surface, after the completion of a well. (Mitzakis) 

Casing Dog. In well boring, a fishing instrument provided with serrated 



960 MORRISON'S OIL RIGHTS 

pieces or dogs sliding on a wedge, to grip severed casing; also called 
Bull dog; Casing spear. (Nat. Tube Co.) 

Casing Elevators. In well-boring, a device consisting of two semi-circular 
clamps, with a chain link on either, that are hinged together at one 
end and secured by a latch at the other. Used for raising and lower- 
ing casing. See also Casing dog. (Nat. Tube Co.) 

Casing Head. 1. A fitting attached to the top of the casing of a well to 
separate oil and gas, to allow pumping, and cleaning out well, etc. 
It may have several lateral outlets, through which the flow of the oil 
can be controlled and led away to reservoirs by means of pipes. 2. In 
well boring, a heavy mass of iron screwed into the top of a string of 
casing to take the blows produced when driving the pipe. Also called 
Drive head. (Nat. Tube Co.) 

Casing-head Gas. Natural gas rich in oil vapors. So named as it is usu- 
ally collected, or separated from the oil, at the casing head. Fre- 
quently called Combination gas or Wet gas. 

Casing Spear. An instrument used for recovering casing which has ac- 
cidently fallen into the well. The "bull dog," which is the most simple 
form of casing spear, consists of a steel body tapered at the top, on 
which slide two steel segments with serrated edges. When lowered in- 
side the casing to be recovered the steel segments are pushed upwards, 
along the narrow part of the body, but when raised, the segments re- 
main stationary, and the weight of the casing forces the thicker part 
to exercise a pressure on the segments forcing them outward. The 
greater the pull, the greater is the corresponding lateral pressure. 
(Mitzakis). Also called Casing dog. 

Centroclinal. In geology, an uplift of strata which gives them a partial 
quaquaversal dip. (Standard) Quaquaversal means inclining out- 
ward and downward in all directions from a center. 

Churn Drill. Also called Cable drill or Well drill. A portable drilling 
equipment usually mounted on four wheels and driven by gasoline, 
electricity, or steam. Also applied to a stationery drill operated 
from a derrick as in oil-well drilling. The drill head is raised by 
means of a rope or cable and allowed to drop, thus striking successive 
blows by means of which the rock is pulverized and the hole deepened. 
( Bowles ) 

Coal. A carbonaceous substance formed from the remains of vegetation 
by partial decomposition. (U. S. Geol. Surv.) Solid or more or less 
distinctly strati lied, varying in color from dark-brown to black, brittle, 
combustible, and used as a fuel. In its geological growth it seems 
to have first taken the form of peat, then liyivite and finally bituminous 



GLOSSARY !Mil 

coal. When by the action of heat the bitumen has been driven oft. 
it becomes anthracite. Its most familiar varieties arc: lignite, bi- 
tuminous, anthracite and cannel. Commercially it has innumerable 
distinctions according to its use for various purposes. 

Coal Gas. Gas made from coal by distilling bituminous coal in retorts, and 
used for lighting and heating. (Webster) 

Coal Oil. 1. The crude oil obtained by the destructive distillation of bi- 
tuminous coal. 2. That distillate obtained from such a crude oil 
which is used for illuminating purposes — kerosene. 3. Crude petro- 
leum. ( Bacon ) 

Coal Tar. A tar obtained by the destructive distillation of soft or bitu- 
minous coal, as in the manufacture of coal gas. It is a complex mix- 
ture of hydrocarbons and other substances. It is the source of many 
dyestuffs. (Webster) 

Coke. Bituminous coal from which the volatile constituents have been 
driven off by heat, so that the fixed carbon and the ash are fused to- 
gether. Commonly artificial, but natural coke is also known. (U. S. 
Geol. SurV.j 

Coking Coal. The most important of the bituminous coals, which burns 
with a long yellow name, giving off more or less smoke, and creates an 
intense heat when properly attended. It is usually quite soft, and does 
not bear handling well. In the fire it swells, fuses, and finally runs to- 
gether in large masses, which are rendered more or less porous by the 
evolution of the contained gaseous hydrocarbons. (Chance) 

Conservation. Preserving, guarding, protecting. As understood in recent 
legislation it means the preservation of the forests, coal, oil and other 
minerals from indiscriminate waste, from non-economical processes 
and from monopoly. 

Continuous Process of Distillation. A petroleum distillation process in 
which the crude oil flows slowly by gravitation through a series of 
stills or retorts each placed slightly lower than the preceding one. 
Each still has a carefully maintained temperature, and yields, there- 
fore, continuously a product of given volatility. (Mitzakis) 

Core Drill. Any form of drill which secures a continuous sample of the 
rock penetrated. The diamond drill is one of its forms. It is also 
known as adamantine drill, shot drill and calyx. It preserves a log 
of the strata through which it penetrates. It is described in Bowles 
v. Virginia Soapstonc Co., 115 Va. 600. 

Core Snatcher. A company man who collects and takes care of drill cores 
when the drilling is being done by contract. 
M. 0. Pv.— 61. 



l )62 MORRISON'S OIL BIGHTS 

Cracking of Oil. A name given to the method by which hydrocarbons of 
one composition are reduced to lower members of the same series, 
or converted into other hydrocarbons during distillation. (Mitzakis'j 

Crew. The crew of an oil well consists of a driller and a tool dresser. 

Culm. The refuse of a coal mine. It may contain coal intended for fu- 
ture recovery. 

D. 

Derrick. 1. The framework or tower over a deep drill hole, such as that 
of an oil well, for supporting the tackle for boring, hoisting or low- 
ering. 2. Any of various hoisting apparatus employing a tackle 
rigged at the end of a spar or beam. (Webster) 

Destructive Distillation. The process of heating an organic compound in 
a closed vessel, without access of air, and collecting the products. 
(Nicholls). A process of distillation in which hydrocarbon molecules 
are broken down. Thus illuminating gas is a product of the destruc- 
tive distillation of coal. Also called Dry distillation, and Cracking. 

Diamond Drill. A form of rotary rock drill in which the work is done by 
abrasion instead of percussion, black diamonds (borts) being set in the 
head of the boring tool. (Raymond). Used in prospecting and de- 
velopment work where a core is desired. 

Distillation. Volatilization, followed by condensation to the liquid state. 
( Raymond ) 

Distillation, of Petroleum. The process by which heat is applied to the 
crude oil in order that its constituents may pass off in vapor, and 
by suitable arrangements subsequently collected in the form of a 
liquid. ( Mitzakis ) 

Divining-Rod. See Douser and Dousing-rod. 

Dome. In geology, an uplift in which the beds dip outward in all direc- 
tions from a center (Webster). Oil and gas pools are frequently 
found beneath domes. 

Douser (or Dowser). A person who with a forked hazel twig searches 
for water or ore underground. Also in use for a person who with a 
divining-rod or other instrument claims ability to locate an oil pool. 

Dousing Rod. A divining-rod used by a douser. 

Drilling. A term employed in a general way to denote the different 
processes employed for the discovery and extraction of petroleum or 
natural gas. Two general methods of drilling have come to be let- 



GLOSSARY 968 

ognized: (a) Percussion systems, cable drilling, which consists of 
breaking up the gi-ound by means of a sharp pointed instrument of a 
particular form, which is made to strike the ground in a series of 
blows; and (d) Rotary systems, a form of drilling required in ground. 
where the hole will not stand up and necessitates forcing a pipe down 
ward with a circular motion. 

Drip. A name given to an apparatus attached to natural-gas wells to 
exclude from the mains any liquid, such as oil or water, that may- ac- 
company the gas. It usually consists of four iron tubes placed ver- 
tically, the inner two being connected by a cross tube. During the 
passage of the gas through this apparatus, the liquid becomes sepa- 
rated and accumulates in a tube called a tail piece, from which it 
is blown out from time to time. 

Driven Well. A well which is sunk by driving a casing, at the end of 
which there is a drive-point, without the aid of any drilling, boring, 
or jetting device. (Meinzer) 

Drive Pipe. 1. A pipe which is driven or forced into a bored hole, to shut 
off water, or prevent caving. (Nat. Tube Co.) 

2. A thick type of casing fitted at its lower end with a sharp stee* 
shoe, which is employed when heavy driving has to be resorted to fo. 
inserting the easing. (Mitzakis) 

Drive-pipe Ring. A device for holding the drive pipe while being pulled 
from well. (Nat. Tube Co.) 

Driving Cap. A cap of iron, fitted to the top of a pipe, as in an oil well, 
to receive the blow when driven and thus protect the pipe. (Century) 

Dry Gas. Natural gas obtained from sands that produce gas only. It 
does not contain oil vapors. 

Dry Hole. A drill hole in which no water is used, as a hole driven up- 
ward (Standard). A well in which no oil or gas is found. 

Duster. An unproductive boring for oil or gas. 

Dynamite. Originally, an explosive made of 75 per cent nitroglycerin 
absorbed in 25 per cent kieselguhr; now any high explosive containing 
explosive ingredients and used for blasting purposes. (Du Pont) 



Edge Water. In oil and gas wells, water that holds the oil and gas in 
the higher structural positions. Edge water usually encroaches on a 
field after much of the oil and gas has been recovered and the pres- 



1*64 MOKE ISON '8 OIL RIGHTS 

sure has become greatly reduced. Compare Top water; Bottom water, 
(U. S. Geol. Surv. Bull. 658, p. 44). 

Element. In Nelson's Encyclopedia, elements are defined as "those, forms 
of matter which hitherto have defied all efforts to break them up in- 
to portions having different properties," which definition can hardly 
be improved. Whether they are really ultimate forms of matter is 
a question upon which there has been much speculation and but little 
evidence. The familiar gases, oxygen and nitrogen, are found free; 
also the common metals such as gold, silver and copper, but with 
these and a few other exceptions, a native single element is rare. 
The ancients limited the elements to air, earth, water and fire, to 
which Aristotes added ether, a basis for many philosophic theories 
and only that. In the middle ages ^ame alchemy, which in the 
search for the impossible, found the practicable. The segregation of 
oxygen by Priestley in 1774 might be called the starting point for 
modern chemistry. When it was conceded that elements existed, as 
we now understand the term, the list of them was few, confined 
principally to the well known metals and the common gases. The 
table of them has been vastly enlarged, but the latest discoveries seem 
confined to minute constituents of the atmosphere and to metals all 
of them scattered in distribution and very rare in quantity. The 
spectroscope has. indicated the existence of more than one element 
before it was known on earth. 

The following table gives a list of the elements, their Symbols, 
Atomic Weights, Specific Gravity and Fusing Points according to 
the centigrade thermometer. (To convert Fahrenheit to Centigrade 
readings, subtract 32° from the former and then divide by 1.8.) 
Among the recent elements is Radium, the discovery of which has 
done much to shake the previously accepted definition of an element. 

TABLE OF THE ELEMENTS. 

Their Symbols. Atomic Weights, Speciiic Gravity and Fusing Points. 

Atomic Specific Melting 

Symbol. Weight. Gravity. Point. 

Aluminum Al 27 . 1 2.6 057° 

Antimony Sh 120 . 2 6.6 630 

Argon ' A 39.88 (1.5) —190 

A rsenic As 74 .96 5.7 500 

Barium Ba 1 37 .37 3. 8 850 

Bismuth Bi 208.0 9.8 268 

Boron I) 11.0 2.5 I If fusible 

Bromin Br 79 . 92 (3.2 | —7 

Cadmium Cd 112.40 8.6 322 



GLOSSARY 



965 



TABLE OF THE ELEMENTS— continued. 



Atomic 

Symbol. Weight. 

Caesium Cs 132 . 81 

Calcium Ca 40 . 07 

Carbon C 12 . 005 

Cerium Ce HO . 25 

Clilorin CI 35.46 

Chromium Cr 52 . 

Cobalt Co 58.97 

Columbium Cb 93 . 1 

Copper Cu 03 . 57 

Dysprosium Dy 102 . 5 

Erbium . Fr 167 . 7 

Europium Eu 152 . 

Fluorin F 19.0 

Gadolinium Gd 157 . 3 

Gallium Ga 69 . 9 

Germanium Ge- 72 . 5 

Glucinum Gl 9.1 

Gold .. Au 197.2 

Helium He 4 . 00 

Holmium Ho 163 . 5 

Hydrogen H 1 . 008 

Indium In 114 . 8 

Iodine I 126 . 92 

Iridium Ir 193 . 1 

1 ron ". Fe 55 . 84 

Krypton '-. Kr f 82 , 92 

Lanthanum ; La 139.0 

bead Pb 207.20 

Lit bium Li 6.94 

Lutecium Lu 175 . 

Magnesium " Mg 24 . 32 

Manganese Mn 54 . 93 

Mercury Hg 200 . 6 

Molybdenum Mo 96 . 

Neodymium Nd 144.3 

Neon Ne 20 . 2 

Nickel Ni 58 . 68 

Niton (radium emanation) Nt 222.4 

Nitrogen N -14.01 

Osmium Os 1 90 . 9 

Oxygen . . O 10 . 00 

Palladium Pd 100 . 7 

Phosphorus P 31 . 04 



Specific 
Gravity. 

1.9 

1.6 

3.5 

7.04 
(1.3) 

8.8 
7.2 
8.9 

4.8 

(1-1) 



i>. 

5. 
1. 

19. 
0. 



(.06) 

7.1 

4.9 
22.4 

7.9 
(2.2) 

6.2 
11.4 
.59 

1.7 
7.4 

(13.6) 
8.6 
7.0 

8.8 

.79 
22 . 5 

(1.13) 
11.4 

1.8 



Melting 

Point. 

27 

800 

Infusible 

623 
—102 
1515 
1530 
1950 
1184 



—223 

29.5 

900 

1064 



—259 

155 

114 

2250 

1550 

—169 

810 

328 

186 

633 
1245 
—40 
1600 

840 

1480 

—213 

2500 

—253 

1587 
44 



%6 



MORRISON'S OIL RIGHTS 



TABLE OF THE ELEMENTS— continued. 

Atomic Specific Melting 

Symbol. Weight. Gravity. Point. 

Platinum Pt 195 . 2 21. 5 1780 

Potassium K 30.10 .87 62.5 

Praseodymium Pr 140 .0 0.5 1)40 

Radium Ra 226.0 

Rhodium . Rh 102 . it 12.1 2000 

Rubidium Rh 85 .45 1 . 5 38 . 5 

Ruthenium : Ru 101 . 7 12.3 2000 

Samarium Sa 150 .4 7.8 • 1350 

Scandium Sc 44 . 1 

Selenium Se 79.2 4.5 217 

Silicon Si 28.3 2.4 1200 

Silver.. Ag 107.88 10.5 962 

Sodium Na 23 . 00 .98 97 

Strontium Sr 87 . 63 2.5 800 

Sulphur S 32.06 2.07 115 

Tantalum . . .-. Ta 181.5 16. S 2250 

Tellurium Te 127 . 5 6.2 455 

Terbium . Tb 159 . 2 

Thallium , Tl 204.0 11.9 302 

Thorium Th 232 .4 11.2 1450 

Thulium .Tm 168 . 5 

Tin Sn 118.7 7.3 232 

Titanium : Ti 48 . 1 3.5 1850 

Tungsten W 184 . 19 . 3 1700 

Uranium U 238.2 ■ 18.7 1600 

Vanadium V 51 .0 5.9 1680 

Xenon !. . . Xe 130.2 (3.5) —140 

Ytterbium (Neoyt terbium) Yb 173.5 

Yttrium Yt 88.7 3.8 

Zinc Zn 65.37 7.1 419 

Zirconium Zr 90.6 4.2 1300 

In the above table of atomic -weights, the basis is 0=16. The figures in 
parentheses refer to the liquid form. 

Escarpment. The precipituous face of a ridge; a cliff. Applied to oil- 
shale deposits. 

F. 

Fault. A break in the continuity of a vein, seam or body of rock. In 

coal mines it throws the bed, usually up or down, sometimes laterally. 
In oil mining it is material when the bore unexpectedly passes from 
one formation into another, showing by such change that an invisible 
fault has occurred. In Fay's Glossary, Bulletin 95, Int. Dept. is an 



I 



GLOSSARY 967 

enumeration of many forms of faults and many different terms by 
which they are designated. 

Fells Shale. A Scottish oil shale, which yields from 26 to 40 gal. of 
crude oil and from 20 to 35 lb. of ammoniuum sulphate per ton. (Ba- 



Field. The territory within which oil, coal or other mineral may be 
looked for. It must, of course, have wide and indefinite boundaries. 

Fire Damp. A combustible gas formed by the decomposition of coal, which 
explodes upon ignition when mixed with atmospheric air. Firing 
point is the point at which fire damp so mixed, explodes. 

Flashing Point; Flash Point. The temperature at which petroleum, being 
heated, begins to evolve vapor in such quantity that on the applica- 
tion of a small flame a momentary flash due to the ignition of the 
vapor occurs. (Mitzakis) 

Flash Test. A test to determine the flashing point of an oil. (Webster) 

Flowing" Well. An oil well in which pumping is not necessary to bring 
the oil to the surface. (Redwood, p. 244) 

Fractional Distillation. An operation for separating a mixture of two or 
more liquids which have different boiling points (Century). Used ex- 
tensively in petroleum distillation. 

Fume. The gas or smoke, given off by an explosion; also the volatile 
emissions from smelted mineral which escape, into the air; also the 
volatile emanations from oil. Gas itself is a fume. 

G. 

Gas. One of the three forms, gaseous, liquid and solid, which all elements 
are supposed, theoretically, to assume; an elastic fluid which tends to 
expand indefinitely. As used in domestic life it means a distillation 
of hydrocarbons from coal, for heat or illumination. Water gas is 
a mixture of hydrogen and carbon monoxide; it is made by forcing 
steam over incandescent coke and is then carburetted with cracked 
oil. When found beneath the earth's surface fit for illumination or 
fuel, it is called natural gas. A poison gas is sometimes found as in 
Baca County, Colorado, which is not fit for fuel. 

Gas Coal. Any coal that yields a large quantity of illuminating gas on 
distillation (Gresfey). It should be free from sulphur and other im- 
purities. 

Gas Coke. The coke formed in gas retorts, as distinguished from that 
made in coke ovens. (Webster) 



MS MORRISON '8 OIL RIGHTS 



Gas Oil. One of the first products of distillation in the manufacture of 
lubricating oils. (Mitzakis) 

Gasol. A product condensed from casing-head gas by applying a pressure 
of 850-900 pounds per square inch at ordinary temperature. It has 
a specific gravity of 0.5, and one pound of the liquid produces seven 
cubic feet of gas. (Bacon) 

Gasoline. A name applied broadly to the lighter products derived from 
the distillation of crude petroleum having a specific gravity of 0.629 
to 0.6673 (95° to 80° B.). It is volatile, inflammable, and used as a 
fuel in vapor stoves and engines; also as a solvent for fats and oils. 

Gas Sand. A stratum containing natural gas. 

Gas Separator. See Gas trap. 

Gasser. A well that yields gas, especially an oil well producing much gas. 
( Webster ) 

Gas Trap. One of many devices for separating and saving the gas from 
the flow and lead lines of producing oil wells. The mixture of oil and 
gas is allowed to flow through a chamber large enough to reduce the 
velocity of the mixture to the point at which the oil and gas tend to 
separate. The gas seeking the top of the chamber, is drawn off free of 
oil, while the oil is discharged at the bottom. (Tech. Paper Xo. 209, 
Bu. Mines) Also called Gas separator; Gas tank. 

Gas Well. 1. A deep boring, from which natural gas is discharged. (Ray- 
mond ) 

2. As used in oil and gas leases, a well having such a pressure and vol- 
ume of gas, and, taking into account its proximity to market as can 
be utilized commercially. {Prichard v. Freeland Oil Co., 84 S. E. 946 i 

Gas Zone. A formation which contains capillary or supercapillary voids, 
or both, that are full of natural gas under pressure considerably ex- 
ceeding the atmospheric pressure. (Meinzer) 

Geology is the science of the life of the earth as recorded in the rocks. It 
is essentially a modern science. Beginning by the study of the earth 
at Avidely separated points, its original nomenclature was notably 
local, as the Cambrian, the Devonian, the Mississippian formations. 
It advanced and built itself upon the theory of the development of 
life. Starting with the Archean, where no fossils are found, inferring 
the absence of life, it advanced to the Paleozoic or age of lower life 
and abundant vegetation. The third grand division is the Mesozoic 
meaning intermedia tr life, the age of reptiles, and (lie fourth is the 
< lenozoic separated into the Tertiary or age of mammals and the 



GLOSSARY 969 

Quaternary, the age of man. It is a speculative science, synthetic, 
building up a theory by the collation of separate facts, while Chemis- 
try purports to be a fixed science. These two bear the same relation 
to each other that surgery bears to medicine. 

To each of the periods above mentioned millions of years are al- 
lowed, the estimate of the number of millions being merely scientific 
guesses. The oil and coal formations are credited generally to the 
carboniferous subdivision of the paleozoic period. Geologic points 
and questions sometimes arise in oil and coal litigation but are not 
often of material value. 

Gob-Fire. Fire originating spontaneously from the heat of decomposing 
coal refuse. 

Go-Devil. A device for exploding the nitroglycerine used to shoot an oil 
well. 

H. 

Hand-dug Wells. The earliest known method of extracting petroleum was 
by means of pits dug by hand labor. The usual method was to dig 
a few feet and then allow the oil to collect at the bottom, whence it 
was subsequently collected by means of a suitable vessel. The deepest 
of these wells rarely exceeded 50 feet. (Mitzakis) 

Hard-rock Phosphate. A term used in Florida to designate a hard, mas- 
sive, close-textured, homogenous, light-gray phosphate, showing larger 
or smaller irregular cavities, thai are usually lined with secondary 
mammilliary incrustations of phosphate of lime. (PoAver) 

Helium. An inert, monatomic, gaseous element occuring in the atmos- 
phere of the sun and stars, and in small quantities in the earth's at- 
mosphere, in several minerals and in certain mineral waters. Sym- 
bol, He; atomic weight, 4.0; specific gravity, 0.12. (Webster) 

Homocline. In geology, a group of inclined beds of the same dip, which 
may be either monoelinal, one limb of a fold, or isoclinal, but whose 
actual relations are not determinate (La Forge). Used in a more re- 
stricted sense than a monocline in that it applies to small or fragmen- 
tary areas. 

Hydrocarbon. A compound containing only hydrogen and carbon. The 
simplest hydrocarbons are gasses at ordinary temperatures; with in- 
crease in molecular weight they change to the liquid, and finally to 
the solid state. (Webster) 

I. 

Isocline. In geology, a series of isoclinal strata. An anticline or syn 



JJ'70 MORRISON'S OIL RIGHTS 

cline so closely folded that the rock beds of the two sides or limbs 
have the same dip. (Webster) Also called an Overturn, or Over- 
turned anticlinal. 

J. 

Jars. In well drilling, a connection between the sinker bar and the poles 
or cables, made in the form of two links, that slide on each other from 
6 to 36 inches. The jars permit the tools to fall on the down stroke, 
but on the up stroke jar them, or give them a sharp pull, tending 
to loosen them from any crevices or cavings that may hold them; a 
drill jar. (Nat. Tube Co.) 

Jumper. A cornish form of the churn drill. 

K. 

Kerosene. A mixture of hydrocarbons whose average boiling point is 
about 450° F., freed on the one hand from gasoline or naptha and on 
the other hand from the heavy hydrocarbons that belong to gas oil 
and lubricating oil. (Bacon) 

Kerosene Shale. Any bituminous shale from which illuminating oil may 
be obtained. 



Lignite. A brownish-black coal in which the alteration of vegetal ma- 
terial has proceeded further than in peat but not so far as sub-bitu- 
minous coal. (U. S. Geol. Surv. ) 

Log. The record of a drill hole, showing the strata through which it 
penetrates and the number of feet of each stratum. Also the record 
of the production of a well. 

M. 

Maltha. The pitch or gum resulting from the drying up of petroleum 
which has reached the surface. 

Mineral. The term mineral, when employed in a conveyance, is under- 
stood to include every inorganic substance that' can be extracted from 
the earth for profit whether it be solid, or rluid, as mineral waters, 
petroleum, and gas. {Horse Creek Land and Mm. Co. v, M idle iff 
(W. Va.) 95 S. E. 27) 

Mineral Oil. A synonym for petroleum. 

Mining. The physical search for inorganic values. It includes both sur- 



GLOfcWAKY !)71 

face and underground work. Burdick v. Dillon, 144 Fed. 739. As to 
whether oil-boring is mining, see chap. 2. 

Mississippian. The first of the three epochs into which the Carboniferous 
period is ordinarily divided; regarded by many geologists as itself 
a period. Also the series of strata during that epoch. (La Forge) 

Monoclinal. 1. Dipping only in one direction, or composed of strata so 
dipping; as, a monoclinal ridge; a monoclinal flexure. Sometimes im- 
properly called uniclinal. 2. An abrupt downward flexure of nearly 
horizontal strata without any corresponding bend to form an anticline 
or syneline. 3. Loosely, any series of strata dipping in one direction 
only, as an isocline. (Standard) 

Monocline. A monoclinal fold. (Webster) 

N. 

Naphtha. 1. As used by ancient writers, a more fluid and volatile variety 
of asphalt or bitumen. 2. In modern use, an artifical, volatile, color- 
less liquid obtained from petroleum; a distillation product between 
gasoline and refined oil. (Century) 

Naphtha-gas. Illuminating gas charged with the decomposed vapor of 
naphtha. (Standard) 

Natrium. Same as Sodium. 

Natural Gas. A mixture of gaseous hydrocarbons found in nature; in 
many places connected with deposits of petroleum, to which the gas- 
eous compounds are closely related. (U. S. Geol. Surv.) 

Neutral Oil. An oil of 32° to 36° Be. gravity. 290° to 318° F. flash 
point, and 47 to 81 sec. Saybolt viscosity at 70° F. It is sometimes 
mixed, with animal or vegetal oils. 

Noger. A jumper drill. (Raymond) 

o. 

Offset Well. A well drilled to prevent the drainage of oil outside the 
leased boundaries under the doctrine of protection. 

Oil. A large class of unctuous, combustile substances, liquid or at least 
liquefiable upon heating, and soluble in ether but not in water. It 
includes animal, vegetable and mineral oils, but within its mining 
meaning is confined to Petroleum. 

The standard dictionary enumerates more than 100 kinds of animal 
and vegetable oils but the only mineral oil of commercial importance 
is petroleum. Its many names are listed under that word. It 



^72 MORRISON'S OIL RIGHTS 

varies in color and odor, in its specific gravity between 0.8 and 0.02, 
and in its minor combinations with the essential hydrocarbons. 
As a lubricant it is not equal to the general run of animal or vegetable 
oils but as a source of heat and l.ight it excels them. In the amount 
and value of its total product it vastly exceeds all other oils com- 
bined. 

Oil Derrick. A towerlike frame used in boring Oil Wells, to support mid 
operate the various tools. (Standard) 

Oil Field. A district containing a subterranean store of petroleum of eco- 
nomic value. (Webster) 

Oil Gas. Illuminating gas, or heating gas, made by distilling oil in closed 
retorts. (Standard) 

Oil-gas Tars. Tars produced by "cracking" oil vapors in the manufacture 
of oil gas. (Bacon) ■ 

Oil of Paraffin. A colorless to yellowish, limpid oil, having a sprvinV 
gravity of about 0.880 and not boiling below 360.° It is composed 
principally of high-boiling hydrocarbons of the CnH;,n_|_ 2 series, and 
is obtained from the petroleum fraction boiling above 300,° the prod- 
uct being refined and decolorized. It is used in pharmacy, in oint- 
ments, and as the base for various coatings insoluble in water. (Ba- 
con) 

Oil Pool. An accumulation of oil in sedimentary rock that yields petro- 
leum on drilling. The oil occurs in the pores of the rock and is not a 
pool or pond in the ordinary sense of these words. ( U. S. Geol. Surv., 
Bull. 613, p. 184) 

Oil Sand. Porous rock formation from which petroleum is obtained by 
drilled wells. (Webster) 

Oil Saver. An appliance affixed to the mouth of an oil well when the lat- 
ter requires deepening, although still flowing in small quantities. It 
consists of a cap fitted to the top of the well casing and having a 
lateral pipe communicating with a reservoir for the oil. (Mitzakis) 

Oil Shale. Shale containing such a proportion of hydrocarbons as to be 
capable of yielding mineral oil on slow distillation. 

Oil-well Packing. A packing inserted between the pipe and the interior 
surface of the boring in an oil well to keep surface water or water from 
the sides of the hole from running into the well, and to prevent oil in 
some wells from being forced out around the pipe by a pressure of 
gas. (Century) 

Orchard-heating Oil. A dark oil from California petroleum, possessing a 



GLOSSARY 973 

gravity of 20° to 28° Be\ ; it is also termed smudge oil, and is used in 
the orange and lemon groves to prevent frost from injuring the trees. 
(Bacon ) 

Ozocerite; Mineral .Wax; Fossil Wax, Native Paraffin. Waxlike hydrocar- 
bon, yellow-brown to green in color; translucent when pure; feels 
greasy. Streak is light to brown, and specific gravity is slightly less 
than 1. Soluble in carbon disulphide. (U. S. Geol. Surv.) 



Packer. A device lowered in the lining tubes, which swells automati- 
cally, or can be used to expand by manipulation from the surface at 
the correct time, to produce a. watertight joint against the sides of 
the bore hole or the casing, thus entirely excluding water from higher 
horizons. (Mitzakis) 

Packing. A general term relating to a yielding material employed to 
effect a tight joint. A common example is the sheet rubber used for 
gaskets. The term is also applied to the braided hemp or metallic 
rings used in some joints, that allow considerable or incessant mo- 
tion. (Nat. Tube Co.) 

Paraffin. A white, waxy, inodorous, tasteless substance a by-product of 
crude oil harder than tallow, softer than wax, with a specific gravity 
of 0.890. Its melting point is variable, depending somewhat upon its 
origin; it ranges between 43° and 65° C. (109° and 151° F.) An 
ultimate analysis yields, on the average, carbon 85 per cent, and 
hydrogen 15 per cent. It is insoluble in water, is indifferent to the 
most powerful acids, alkalies, and chlorine, arid can be distilled un- 
changed with strong sulphuric acid. Warm alcohol, ether, oil of 
turpentine, olive oil, benzol, chloroform, and carbon disulphide dis- 
solve it readily. It can be mixed in all proportions with wax, stearin, 
palmitin, and resin. (Bacon). It is the base of all high grade oil 
that is capable of being refined. 

Paraffin-asphalt Petroleum. A combination of paraffin-base and asphalt- 
base petroleums. (Bacon) 

Paraffin-base Petroleum. Crude oil which carries solid paraffin hydro- 
carbons and practically no asphalt. (Bacon) 

Paraffin Butter. A variety of native paraffin used in making candles. 
(Standard) 

Paraffin Coal. A light-colored bituminous coal used for the production 
of oil and paratnn. (-uuzakis) 



1) 74 MORRISON'S OIL RIGHTS 

Paraffin Fluxes. The residuals obtained from para din-base petroleums are 
characterized by containing 14| to 4 per cent, of hard paraffin scale, 
consisting to a predominating degree of saturated hydrocarbons (85.6 
to 74.1 per cent.) and having a specific gravity of 0.92 to 0.94. In 
general, it may be said that paraffin fluxes yield only a small per- 
centage of residual coke and contain but little sulphur. (Bacon) 

Paraffin Oil. Lubricating oil made by the dry distillation method. 

Peat. The residuum from the partial disintegration of the vegetation in 
bogs. Because of its high carbon content, it will burn freely when 
dry. It is supposed to be the beginning of what ultimately would 
become a coal formation. It is rich enough to yield both gas and 
tar on distillation. 

Petrol. A variant for petroleum or its derivatives, particularly gasoline 
or motor spirit. (C. and M. M. P.) 

Petrolatum Liquidum. The medicinal high-boiling petroleum oil of the 
United States Pharmacopoeia. (Bacon) 

Petrolatum Oil. A colorless, straight -reduced, viscous, neutral oil, pos- 
sessing a gravity of 32f° to 34° Be., a flash-point of 415° F., a fire 
test of 480° F., a cold test of 20° F., and a viscosity of 185 to 200. 
It is also termed 'medicinal oil.' (Bacon) 

Petrolene. A liquid hydrocarbon mixture obtained from bitumen or as- 
phalt. (Century) 

Petroleum. A liquid inflammable combination of numerous hydrocarbons, 
chiefly of the paraffin series. Its derivation from petros (rock) and 
oleum (oil) indicates both its origin and its physical composition. 
It is along with coal one of the two great carbon compounds. It has 
been found on the surface of the ocean, in the crevices of rock and 
floating in springs but its one important source is from deep drilling 
thousands of feet into the earth. 

It has been known as mineral oil, rock oil, natural oil, coal oil, 
carbon oil, earth oil, Seneca oil. St. Quirinas oil, — 'but even the primi- 
tive term petroleum, gives way to the universal accepted, unquali- 
fied monosyllable "Oil." 

Petroleum Asphalt. The residues of asphalt-base petroleum, known com- 
mercially as petroleum asphalt. (Bacon) 

Petroleum Coke. The residue obtained by the distillation of petroleum. 

Petroleum Ether. A volatile, inflammable liquid used as a solvent for 
caoutchouc, etc.; a term sometimes applied to naphtha. 

Petroleum Spirit. A volatile liquid obtained by the distillation of pe 



GLOSSARY 975 

troleum. (Webster) A term variously used, but is sometimes ap- 
plied to a petroleum distillate of a density of 0.71 to 0.74 and a boil- 
ing point of 90° to 140° C. It is used as a solvent. (Bacon) 

Petroline. A solid substance, analogous to paraffin, obtained in the dis- 
tillation of Rangoon petroleum. Also, a term applied to a Scottish 
oil having a flash point of 126° F. (Bacon) 

Phosphate Rock. A sedimentary rock containing calcium phosphate. The 
form in which the phosphate occurs is obscure (U. S. Geol. Surv.). 
The three main classes which have been exploited in the United States 
are land rock, occurring in clayey, gravelly, or compacted beds below 
the surface of the earth; river rock, a darker variety obtained from 
river and stream beds, and the oolitic phosphates of Tennessee. (Web- 
ster) 

Phosphates. Salts formed by combining phosphoric acid with an alkali. 
Sodium, potassium, ammonium and calcium phosphates are used in 
fertilizers. None of these are used to a large extent except the cal- 
cium phosphate. See Phosphate rock. 

Pipe Line. A line or conduit of pipe, sometimes many hundred miles long, 
through which petroleum is conveyed from an oil region to a mar- 
ket or to reservoirs for refining. (Standard). A line of pipe with 
pumping machinery and apparatus for conveying a liquid, or gas. 

Pitch. One of the residues formed in the distillation of wood or coal tar. 
It is also obtained from petroleum. The term "pitch" is sometimes 
employed indiscriminately to mean bitumen or asphalt. (Mitzakis) 

Plugging. Closing the mouth of a well either to prevent escape from or 
entry into it. Required by many States on abandonment of wells with 
minute statutory directions as to the kind of plug to be used. 

Potash. The oxide of potassium, K 2 0. Not an independent compound, 
but used as a basis of comparison for all potash minerals and artifi- 
cial salts. The potash of commerce is derived from the minerals car- 
nallite, kainite, sylvite (not found in the United States), and niter, 
and also from certain sea-weeds and wood ashes. 

Potassium. A soft, light, silver-white metal of the alkali group, occur- 
ring abundantly in nature, but always combined. Symbol, K; atomic 
weight. 39.10; specific gravity, 0.865. (Webster) 

Power Gas. Any gas made for producing power, as for driving gas en- 
gines. (Webster) 

Producer Gas. A combustible gas to be used for fuel, for driving gas en- 
gines, for making illuminating gas, etc., made by forcing steam and 



,976 MORRISON'S OIL RIGHTS 

air through a layer of incandescent fuel, as coke, the resulting' gas 
consisting largely of carbon monoxide and nitrogen. (Webster) 

Production. The yield or output from the well. Natural production is 
tJie production from a weir which has not been shot. Flush produc- 
tion is the first yield per day from the well, either with or without 
shooting. Settled production is the yield of oil per day after the first 
agitation has ceased and the well has reached an ordinary average 
production basis. 

Public Domain. Land or water owned by the United States as distin- 
guished from land where the government has parted with its title. 
Questions as to what is public domain usually arise on Indian lands 
or where reservations have been abandoned. Winters v. U. 8., 143 
Fed. 748. The original title to the Public domain was in the Indian. 
Cherokee Nation v. Georgia, 5 Peters 1, 8 L. ed. 25; U. 8. v. Cook, 
19 Wall. 591, 22 L. ed. 210. 

Pump". Any of numerous devices or machines for raising, transferring, 
or compressing liquids or gases by suction or pressure or both. 

Pumping Well. This word covers the vast majority of wells where there 
is no pressure to produce a flow and the accumulating oil must be 
brought to the surface by artificial means. Vacuum pumping is for- 
bidden in some fields. 



Quaquaversal. Dipping outward in all directions from a central point: 
as a dome in stratified rocks. (La Forge) 

R. 

Reamer. A tool for enlarging a borehole. (Raymond) 

Reduced Oil. Crude petroleum from which the more volatile hydrocar- 
bons have been eliminated by partial evaporation. (Bacon) 

Residuum. 1. The residue obtained on the distillation of crude petroleum 
after the constituents boiling below 620° F., have been removed. 
2. The residue left in the still after the distillation of crude oil has 
been completed, and not the residue from redistilled condensates. Al- 
so known as the cokings and tailings. (Bacon) 

Rock Gas. Same as Natural gas. 

Rock Drill. A machine for boring in rock, either by percussion, effected 
by reciprocating motion, or abrasion, effected by rotary motion. Com- 
pressed air is the usual motive power, but steam, electricity and 
electricity in combination with compressed air are also used. 



GLOSSARY 977 

Rock Oil. A synonym for Petroleum. 

Rod Guide. An appliance attached to the drilling rod in oil wells thai 
servos to prevent the rod from osdillal ing or knocking against the 
sides of the borehole. (Mitzakis) 

Room and Pillar. A system of mining in which the distinguishing featur" 
is the winning of 50 per cent or more of the coal in the first working. 
The coal is mined in rooms separated by narrow ribs or pillars. The 
coal in the pillars is won by subsequent work. 

Rope Drilling. Drilling in the ground with a bit attached to the end of 
a rope to which a twisting motion is given. Sometimes called Jump 
drilling, as the rope with the bit is raised and dropped. 

Royalty. Rent reserved in kind as a percentage of the oil, coal or ore 
mined. 

Run of Mine. Coal as it is dug in the mines, including lump and fine coal 
together, without any preparation or screening. (Nicolls) 



Safety First. A term often applied to accident prevention methods, and 
first-aid and rescue work. As a slogan, was first used nationally by 
Dr. .Joseph A. Holmes, the first director of the U. S. Bureau of Mines, 
at the national mine safety meet in Pittsburgh, Pa., in 1911. 

Saint Quirinus Oil. Petroleum used medicinally in Germany as early as 
1436, the supply coming from the Tegernsee district of Bavaria. 
(Bacon) 

Saline Dome. An up-swelling of the earth's surfaee on the coastal flats 
of Louisiana and Texas, one-fourth to one mile in diameter, often 
showing a marshy depression at the summit with escaping oil or gas, 
or both, around the periphery of the dome. 

Sand. A term in oil seeking to designate the stratum of whatever com- 
position that carries the oil or gas. 

Sand Line. In well boring, a wire line used to lower and raise the bailer 
or sand pump, which frees the borehole from drill cuttings. (Nat. 
Tube Co.) 

Sand Pump. A cyclinder with a valve at the bottom, lowered into a drill 
hole from time to time to take out the accumulated slime resulting 
from the action of the drill on the rock. Called also Shell pump and 
Sludger. (Raymond) 
M. O. R.— 62. 



978 MORRISON'S OIL RIGHTS 

Scraper Chaser (Oil regions, U. S.). One of a number of men whose busi- 
ness it is to follow the scraper (go-devil) in the petroleum pipes and 
give instant notice if a clog occurs (Standard). He follows the pipe 
line on the surface and detects the location of the go-devil by sound, 
especially where pipes are shallow. 

Seneca Oil (U. S.). Petroleum, early used as a remedy among the Sene- 
caa and other Indians. (Webster) 

Shale. A fine-grained, fissile, argillaceous, sedimentary rock characterized 
by rather fragile and uneven laminae and commonly a somewhat 
splintery fracture. Often, but incorrectly, called slate by miners, 
quarrymen, well-drillers, and others. (La Forge) 

Shale Naphtha. Naphtha obtained from Shale oil. (Bacon) 

Shale Oil. A crude oil obtained from bituminous shales, especially in 
Scotland, by submitting them to destructive distillation in special re- 
torts. (Bacon) 

Shooting a Well. Filling the hole through the oil sand with a high ex- 
plosive (generally nitro glycerin) which when shot increases the 
collection area. (G. L. Warson) . 

Sicilian Oil. Petroleum. It was used, under this name, for illuminating 
purposes at Agrigentum, Sicily, before the beginning of the Christian 
era (Bacon). 

Slate. A coal miner's term for any shale or slate accompanying coal ; 
also sometimes applied to bony coal. 

Slip. 1. A fault. 2. A smooth joint or crack where the strata have moved 
upon each other. 3. A joint in the coal upon which there may have 
been no perceptible movement. (Steel) 

Sodium. A soft, waxy, silver- white metallic element of the alkali group. 
Symbol, Na.; atomic weight 23.00; specific gravity, 0.07. (Webster) 

Solar Oil. A name given to gas oil from petroleum of the Gulf or Mid- 
Continent field. 

Spindle Oil. The lighter portion of the petroleum distillates suitable for 
lubrication of light-running machinery. (Bacon) 

Spouter. An oil well the flow of which has not been controlled by the 
engineers. (Webster) 

Spudding in. The actual commencement of drilling after the rig is com- 
pleted. The first abrasion of the soil made by the drill. This is con- 
sidered the actual commencement of drilling operations. 



i 



GLOSSARY 9?9 

Squib. In well boring, a vessel, containing the explosive and fitted with a 
time fuse, that is lowered into a well to detonate the nitroglycerin 
charge. (Nat. Tube Co.) 

Starter. A drill used for making the upper part of a hole, the remainder 
of the hole being made with a drill of smaller gage known as a fol- 
lower. (Bowles) 

Synclinal. In geology, characteristic of, pertaining to, occurring, or situ- 
ated in, or forming a syncline. (La Forge) The opposite of anticlin- 
al. 

Synclinal axis. In geology, the central line of a syncline, toward which 
the beds dip from both sides. (La Forge) 

Syncline. A fold in rocks in which the strata dip inward from both sides 
toward the axis. The opposite of Anticline. (La Forge) 



Tank. Equivalent to vat; any device for holding oil for transportation or 
further delivery. 

Tankage. 1. The act or process of storing oil, etc., in a tank. 2. The 
price charged or paid for storage in a tank. 3. The capacity of a 
tank or tanks. 4. The waste residue deposited in lixiviating vats or 
tanks. (Century) 

Tar. A thick, brown to black, viscous liquid obtained by tlm distillation 
of wobd, coal, peat, and other organic materials, and having a varied 
composition according to the temperature and material employed in 
obtaining it. (Webster) 

Tincal. Crude native borax, formerly imported from Tibet. (Webster) 
Also spelled Tinkal. 

Top Water. Water which enters an oil or gas well from a sand above the 
productive sand. Compare Bottom water; Edge water. (U. S. Geol. 
Surv. Bull. 658, p. 44) 

Torpedo. A cartridge or shell lowered or dropped into a bored oil well and 
there exploded to clear the well of obstructions or to shatter into the 
source of supply. 

Tower. A day's work of a drilling crew. A tower runs from 12 noon 
until 12 midnight: and from midnight until noon. 

Transformer Oil. An oil for high tension electrical transformers free 
from water and mineral acids. It should show little or no volatility 
at 100° C. Those machine oils, derived from petroleum, which have a 



^60 MORRISON'S OIL RIGHTS 

flash point of over 100° C. (open test), with a volatility of less than 
Oil per cent in five hours at 100° C, are usually suitable for use in 
transformers. (Bacon) 

Tube Packing. A bag of flaxseed, or ring of rubber, made to occupy the 
space between the tube of an oil well and the bored hole to prevent 
access of water to the oil-bearing stratum. (Nat. Tube Co.) 

Tubing. 1. The Tube-lining of boreholes; casing. 2. The act of lining a 
deep borehole by driving down iron tubes. (Ihlseng) 

u. 

Uniclinal. Sloping in one direction; a monoclinal. 

V. 

Vapor. Any visible diffused substance floating in the air and impairing 
its transparency, as smoke, fog, etc. 

Vapor Density. The relative weight of a gas or vapor as compared with 
some specific standard, usually hydrogen, but sometimes air. (Web 

ster ) 

Verifier. In gas testing, an apparatus by which the amount of gas re- 
quired to produce a flame of a given size is measured; a gas verifier. 
(Standard) 

Vivianite. A hydrous, ferrous phosphate, Fe 3 (P0 4 ) 2 8H 2 0, colorless when 
unaltered, or blue to green, growing darker on exposure ( Webster ) . 
Called also Blue iron earth; Blue ocher. 

w. 

Water Surface. In oil wells, the level or inclined plane between the oil, or 
gas, and the edge water upon which the oil or gas rests. Not to be 
confused with ground- water level or table. (U. S. Geol. Surv. Bull. 

258, p. 48) 

Well Packing. A bag of flaxseed or other absorbent material packed 
around the tube of an oil well to prevent access of water to the oil 
in the well. (Standard) 

Well Rig. An assemblage of all mechanisms, including power-motors, nec- 
essary to drilling, casing, and finishing a tube or drilled well. (Stand- 
ard i 

Well Shooting. The firing of a charge of nitroglycerin, or other high ex- 



GLOSSARY 9M 

plosive, in the bottom of a well for the purpose of increasing the flow 
of water, oil, or gas. (Du Pont) 

Wet Gas. SaturaJ gas which contains gasoline extractible in commercial 
quantities. It occurs with, or immediately above the oil. 

Wildcat. 1. Territory supposed to carry oil but not so proved. 2. Any 
risky venture in oil or other mining-. 3. Applied to companies hav- 
ing- no substantial assets, or legitimate foundation for an honest 

prospectus. . 



Xenotime. Essentially an yttrium phosphate, YP0 4 . Cerium and Erbium 
are sometimes present, also silicou and thorium as in monazite. 
(Dana) 



Zone. In geology, used in the same sense as horizon to indicate a cer- 
tain geological level or chronological position, without reference to 
the local attitude or dip of the rock. (Roy. Com.) 



TABLE OF CASES CITED. 
A 

PAGE 
Acme Oil, etc., Co. v. Williams (140 Cal. 681, 74 Pac. 296) ....... 110 

Adams v. Yukon Mining Co. (251 Fed. 226, 16.1 C. C. A. 382) 2.18 

Addleman v. Manufacturers' Light, etc., Co. (242 Pa. 587, 80 Atl. 

674, 255 Pa. 580, 100 Atl. 444 ) 167 

Aderhold v. Oil Well Supply Co. (158 Pa. 401, 28 Atl. 22) 77 

Advance Industrial Supply Co. v. Eagle Metallic Co. (109 Atl. 771) 

(Pa.) * 42, 195 

Advance Oil Co. v. Hunt (116 N. E. 340) (Ind.) 66, 198 

Aggers v. Shaffer (256 Fed. 648 ) 120 

Alaska Mexican Gold Mining Co. v. Alaska (236 Fed. 64, 49 C. C. A. 

274 ) 159 

Alaska Petroleum Coal Co., In re (45 L. D. 56, 65 ) 865 

Aldebarah Mining Co., In re (36 L. D. 551 ) 245 

Alexander v. Wilkesbarre, etc., Co. (254 Pa. 1, L.R.A.1917B, 310, 98 

Atl. 794) 176 

Alexandria Mining Co. v. Irish (16 Ind. App. 534, 44 N. E. 

680 ) : 24. 172 

Alford v. Dennis (102 Kan. 403, 170 Pac. 1005) 37, 118, 123 

Allegheny Oil Co. v. Snyder (45 C, C. A. 604, 100 Fed. 764) 55, 67 

Allen v. Guaranty Oil Co. (176 Cal. 421.. 168 Pac. 884) 55 

v. Xarver (178 Cal. 202, 172 Pac. 980) 96 

Allison v. Coal Creek and N. R. Coal Co. (87 :eim. 60, 9 S. W. 226 | . . 200 

Allison's Appeal (77 Pa. 221, 11 M. R. 142 j 34 

American Bauxite Co. v. Hoard of Equalization (119 Ark. 362, 177 S. 

W. 1151 ) 157 

American Central Insurance Co. v. Green (16 Tex. Civ. App. 531, 41 

S. W. 74) 214 

American Smelting Co., In re (39 L. D. 299) 239 

American Window Glass Co. v. Indiana, etc., Oil Co. (37 Ind. App. 

439, 76 X. E. 1006 ) 83, 90 

Ames v. Sullivan (235 Fed. 880, 149 C. C. A. 192) 240 

v. U. P. Ry. (64 Fed. 165, 178) 32S 

Amnions v. South Pennsylvania Oil Co. (47 W. Va. 610, 35 S. E. 

1004) llfl 

Andrews v. Andrews (256 Pa. 24, 100 Atl. 521) 63. 80 

Anicker v. Gunsberg (246 U. S. 110. 62 L. ed. 603. 38 Sup. Ct. Rep. 

228 ) 217 

983 



( J84 TABLE OF CASKS CITED 

PAGE 

Anstee v. Monroe Light & S. Co. (177 N. W. 26) ITS 

.Anvil Hydraulic, etc., Co. v. Code (182 Fed. 205.. 105 C. C. A. 45) .... 241 

Apple v. Smith ( 185 Pac. 903 ) ( Kan. ) J !>u 

Ardesco Oil Co. v. Richardson (63 Pa. 162, 11 M. R. 131) 137 

Ardizonne v. Archer (177 Pac. 554, 178 Pac. 263) (Okla.) ... 76, 81, 

90, 133, 135 

Arizona, etc., Co. v. lion Cap Co. (124 N. E. 281) (Mass.) 180 

Arizona Hercules Copper Co. v. Protestant Episcopal Church Corp. 

(190 Pac. 85) (Ariz.) 177 

Armitage v. Mt, Sterling Oil and Gas Co. (80 S. W. 177 ) 78 

Armstrong v. Auen (17 M. R. 392, 21 Pgh. Legal Journ. 395) 198 

Arnold v. Garnett Light, etc., Co. (103 Kan. 166, 172 Pac. 1012) . . 28. 96 

v. ( 103 Kan. 477, 174 Pac. 1027 ) 37, 188 

v. Producers 1 ' Oil Co. (196 S. W. 735) (Tex.) 152 

Askren v. Continental Oil Co. (40 Sup. Ct. Rep. 355) 159 

Aspen Mining Co. v. Ruckcr (28 Fed. 220) 205 

Associated Pipe Line Co. v. Railroad Commission (176 Cal. 518, 169 

Pac. 62, L.R.A.1918C, 849) 170 

Aurelius v. Stewart (219 S. W. 863) (Tex. Civ.) 104 

Aycock v. Paraffine Oil Co. ( 210 S. W. 851 ) (Tex. ) 90 

v. Reliance Oil Co. (210 S. W. 848) (Tex.) 62, 66, 128 

Aye v. Philadelphia Co. (193 Pa. 451, 74 Am. St. Rep. 696, 44 Atl. 555, 

20 M. R. 177 j . 89, 110 

B 

Backer v. Pennsylvania Publishing Co. (162 Fed. 627, 89 C. C. A. 

419 ) 59, 208 

Bailey V. State (163 Ind. 165, 71 N. E. 655) 187 

Bain v. White (256 Fed. 428 ) 132, 133, 134 

Baird v. Atlas Oil Co. (84 So. 366) (La.) 113, 114 

Bakersville Co., In re ( 39 L. D. 460 ) 243 

Baldwin v. Blue Stem Oil Co. (189 Pac. 920) (Kan.) 85 

Baffour v. Russell (18 M. R. 202, 167 Pa. 287, 31 Atl. 570) ..... 04. 109 

Ball v. Freeman ( 77 W. Va. 156, 87 S. E. 91) 28 

Baltimore and O. R. Co. v. Maryland (21 Wall. 456) . . 325 

Barbour, etc.. Co. v. Tompkins (81 W. Va, 116, 93 S. E. 1038) 91 

Barker v. Campbell Ratcliff Light Co. (167 Pac. 468) (Okla.) 8 

v. Dale (3 Pitts).. 190, Fed. Cas. No. 988, 8 M. R. 597) .. 103, 

117, 192 
Barnard v. Monongahela Natural Gas Co. (216 Pa. 362, 65 Atl. 801) 

33, 37, 38 

Barnett Oil Co. v. New Martinsville Oil Co. (254 Fed. 481) 156 

Barnsdall v. Boley ( 119 Fed. 191 ) 43, 93 

v. Bradford Gas Co. (225 Pa. 338, 26 L.R.A.(N.S.) 614, 74 Atl. 

207 ) , 192 



TABLE OF ('ASKS CITED 98; 



page 

Barnsdall Oil Co. v. Leahy (195 Fed. 731, 115 C. C. A." 521) 109 

Barron v. Baltimore ( 1 Peters 243) 252 

Hartley v. Phillips (170 Pa, 175, 36 Atl. 217. IS M. R. 542) .... 103, 

110, 111, 116 

v. (105 Pa, 325. 30 Atl. 842, 18 M. K. 145) 192, 240 

Batt v. Stedman (36 Cal. App. 608, 173 Pac. 90) 230 

Batterton v. Douglas Co. (20 Ida. 763, 120 Pac. 827, 38 L.R.A.(N.S.) 

1121) 889 

Bay v. Oklahoma Southern Gas, Oil & Mining Co. (13 Okla. 425, 73 

Pac. 963 ) 228 

Bayer, In re ( 80 Wash. 340, 141 Pac. 682 ) 49 

Beardsley v. Kansas Natural Gas Co. (78 Kan. 571, 96 Pac. 85')) 

21, 205 

Bearman v. Dux Oil, etc., Co. (166 Pac. 199) (Okla.) .. 64, 73, 117, 123 

Beatty Nickel Oil Co. v. Smethers (49 Ind. App. 602, 96 N. E. 19) . . 38 

Beatty Oil & Gas Co. v. Blanton (245 Fed. 979) 58, 118 

Beck v. Finley ( 187 Pac. 488 ) (Okla. ) 147, 152 

Becker Franz Co. v. Shannon Copper Co. ( 256 Fed. 522 ) 240 

Beckett-Iseman Oil Co. v. Backer (165 Ky. 818, 178 S. \Y. 1084 J 149 

Beeson v. Drake Oil Co. (97 S. E. 414) (W. Va.) 138 

Behling v. South West Pennsylvania Pipe Lines (160 Pa. 359, 40 Am. 

St. Rep. 724, 28 Atl. 777 ) 168, 173 

jBelk v. Meagher (104 U. S. 279, 26 L. ed. 735, 1 M. R. 510) 232 

Belvidere Gas, Light & Fuel Co. v. Jackson (81 111. App. J2i) 173 

Benedict v. Columbus Construction Co. (49 N. J. Eq. 23. 23 Atl. 

485) . ... 24 

Bennet v. North British, etc., Insurance Co. (8 Daly (N. Y. ) 471, 81 

N. Y. 273, 37 Am. St. Rep. 501) . 25, 214 

Bcntley v. Zelma Oil Co. (184 Pac. 131, 32 Am. Rep. 170, 3 N. \V. 162, 

6 M. R. 117 ) (Okla.) 155 

Berger \\ Hoerner (36 111. App. 360) 180 

Bettman v. Harness (42 W. Va. 433, 36 L.R.A. 566, 26 S. E. 271, 18 

M. R. 500 ) 63, 95, 1 ^), 19;) 

v. Shadle (53 N. E. 662, 22 Ind. App. 542) 77 

Bewick v. Fletcher (41 Mich. 625, 32 Am. Rep. 170, 3 N. W. 162, 6 

M. R. 117 ) 179 

Bird v. Wilcox (104 Kan. 799, 180 Pac. 774) 150 

Black Lick Manufacturing Co. v. Saltsburg Gas Co. (139 Pa. 448, 21 

Atl. 432) 199 

Biackwell Oil, etc., Co. v. Whitesides (174 Pac. 573) (Okla.) 117 

Blaffer v. Gulf Pipe Line Co. (218 S. W. 89 ) (Tex.) 129 

Blakely v. Marshall (174 Pa, 425, 34 Atl. 564, 18 M. R. 350) 45 

Blanck v. Pioneer Mining Co. (93 Wash. 26, 159 Pac. 1077) 142 

Blodgett v. Liu.yon Zinc Co. (120 Fed. 893, 58 C. C. A. 79) 86. 96 

Bloomlield Light Co. v. Richardson (63 Barb. (N. Y.) 437) 105 



986 TABLE OF CASES CITED 

PAGE 

Board of Health v.'Standard Oil Co. (107 La. 713, 31 So. 1015) 163 

Bpis D'Arc Creek Oil & Gas Co. v. South West Oil Corporation (219 

S. W. 1 115) (Tex.) 11:! 

Bokoshe, etc., Oil Co. v. Bray (-55 Okla, 440. 155 Pac. 226) 209 

Book v. Justice M. Co. ( 58 Fed. 100 } 502 

Boone v. Clark (214 S. W. 007 ) (Tex.) 177 

Borgwardt v. MpKitfrick Oil Co. (164 Cal. 051. 13d Pac. 417) 232 

Boston Franlinite Co. v. Condit (19 N. J. Eq. 394} 200 

Bowles v. Virginia ^oapstone Co. (115 Ya. 690) 961 

Bracey v. Darst (218 Fed. 482 ) 820 

Bracken v. Preston (1 Pin. (Wis.) 584, 44 Am. Dec. 412, 7 M. R. 267) 

194 
Bradford Oil Co. v. Blair (113 Pa. S3, 57 Am. Rep. 442, 4 Atl. 218) 

33, 85, 86, 209, 210 

Brede v. Minnesota Crushed Stone Co. (173 N. W. 805) (Minn.) .... 176 

Brennan v. Gaston (17 Cal. 374, 375, 7 M. It. 426) 194 

— — v. Hunter ( 172 Pac. 49 ) (Okla. ) 58, 75, 123 

Brewster v. Lanyou Zinc Co. (140 Fed. 801, 72 C. C. A. 213) 62, 

70, 83, 86, 116, 117, 122 

Brink v. Caniield ( 187 Pac. 223) (Okla. ) 152, 153 

Bronson v. Lane ( 91 Pa. 153 ) 48 

Bronx Gas Co. v. Public Service Commission (212 N. Y. Supp. 172, 

218 ) 162 

Brooks v. Kunkle (24 Ind. App. 624, 57 N. E. 260, 20 M. R. 540) .. 79 
Brooksliire Oil Co. v. Casmalia Ranch Oil, etc., Co. (156 Cal. 211, 103 

Pae. 927 ) 23, 57, 167, 212 

Brown, In re (20 L. D. 378 ) 320 

Brown v. Forty-Nine, etc., Quartz Mining Co. (15 Cal. 152, 76 Am. 

Dec. 408, 9 M. R. 600) 20 

v. Fowler (65 Ohio 507, 63 N. E. 76) 53, 67, 92 

v. Leach (189 App. Div. (N. Y.) 158, 178 N. Y. Supp. 319) 140 

v. Spilman (155 U. S. 665, 39 L. ed. 304, 15 Sup. Ct. Rep. 245) 

23, 25, 109 

v. Vandergrift (80 Pa. 142) 20, 115, 117, 126 

v. Wilmore Coal Co. (153 Fed. 143, 82 C. C. A. 295) 110 

v. Wilson (160 Pac. 94, 58 Okla. 392, L.R.A.1917B, 1184) 

55, 07, 80 

Brunson v. Carter Oil Co. (263 Fed. 935) 61, 122, 493 

v. ( 259 Fed. 650 ) 60, 80, 125 

Bryson v. Crown Oil Co. (185 Ind. 156, 112 N. K. 1) 22, 207 

Bubb v. Parker, etc.. Oil Co. (252 Pa. St. 26, 97 Atl. 114) 2!» 

Buchanan v. Exchiin^e Fire Insurance Co. (01 N, Y. 20) 214 

Buckner v. Malloy (-— Cal. — . 100 Pac <>S7 ) 145 

Buffalo Valley Oil & Gas Co. v. Junes (75 Kan. 18, 88 Pac. 537) . . 84, 85 

Bullion Beck M. Co. v. Eureka Hill M. Co. (12 Pac. 660) ( I '.tali) 327 



TABLE OF CASES CITED 98 



PAGE 

Burdick v. Dillion (144 Fed. 739) 971 

Burke v. Southern Pacific Railroad Co. (234 U. S. 670. 58 L. od. 1527., 

3 1 Sup. Ct. 907 ) 248, 249, 251 

BurkhardCs Administrator v. Striger (07 S. \V. 270) ( Ky. ) .104 

Burrows v. Petroleum Development Co. (184 Pac. 5) (Cal.) 130 

Burton v. Forest Oil Co. (204 Pa. 349, 54 Atl. 200, 22 M. R. 507) .... 29 

Busch-Everett Co. v. Vivian Oil Co. (120 La. 880, o^ So. 504) 51, 113 

Butler v. City of lola (100 Kan. Ill, 163 Pac. 052) 51 

v. Marston (145 La. 42, 81 So. 749 ) 151, 152 

Butte, etc., Co. v. Clark-Montana Co. (249 U. S. 12, 63 L. ed. — , 39 

Sup. Ct. Rep. 231 ) 233 

Butte Oil Co. (40 L. D. 602 ) 227 

c 

Cadwell v. Sioux Falls Ca. (242 U. S. 539-590) 812 

Calhoon v. Neely (201 Pa. 97, 50 Atl. 967, 21 M. R. 754) 60, 110 

California Oil & Gas Co. v. Miller (96 Fed. 12) 192. I'.»0 

California Well Drilling Co. v. California Midway Oil (178 Cal. 

337, 177 Pac. 849 ) ' 132, 134 

Callahan v. Danziger (32 Cal. App. 405, 163 Pac. 65) 139 

Calor Oil & Gas Co. v. Franzell (128 Ky. 715, 33 Ky. L. R. 98, 109 S. 

W. 328, 122 S. W. 188, 36 L.R.A.(N.S.) 456) 166, 187 

Cameron v. Bass (19 Ariz. 246, 168 Pac. 645) 251 

v. U. S. (40 Sup. Ct. Rep. 410, affirmed, 250 Fed. 943, 103 

C. C. A. 163) 130. 251, 252 

Campbell v. Lynch (81 W. Va. 374. 94 S. E. 739) 49 

v. Smith (180 Ind. 159, 101 N. E. 89) 22, 208 

Camp Bird, Limited v. Howbert (262 Fed. 114) 16U 

Camp Phosphate Co. v. Allen (81 So. 503) (Fla.) 154 

Can field v. Ford ( 28 Barb. 336) 205 

v. Jack (188 Pac. 1040) (Okla.) 21 s 

Canon v. Scott ( 217 S. W. 429 ) ( Tex. ) 9 

Capa v. United States ( 152 U. S. 311 ) 329 

Carnegie Natural Gas Co. v. Swiger (72 W. Va. 557, 46 L.R.A.'(K.S.) 

1073, 79 S. E. 3 ) 165, 166 

Carothers v. Philadelphia Co. (118 Pa. 468, 12 Atl. 314) 105 

Carr v. Huntington Light, etc., Co. (33 Ind. App.l, 70 N. E. 552) 

60, 88 
Carter v. Tyler County Court (45 W. Va. 806, 43 L.R.A. 725, 32 S. E. 

216) 150 

Carter Oil Co. v. Popp ( 174 Pac. 747 ) ( Okla. ) 49 

v. Tiffin (176 Pac. 912 ) (Okla. ) 71 

Cassell v. Crothers (193 Pa. 350, 44 Atl. 446, 20 M. R. 100; 92, 

93, 180, 199 



988 TABLE OF CASES CITED 

PAGK 

Cataract Gold Mining Co. ( 43 L. D. 248 ) 12 

Catlin Coal Co. v. Lloyd (176 111. 275, 52 N. E. 141, 18 111. 398, 72 

Am. St. Rep. 216, 54 N. E. 214) 148 

Caudil v. Wagoner ( 184 Ivy. 381, 212 S. W. 422) .-.'., 49 

Cavanaugh v. Corbin Co. (174 Pac. 184) (Mont.) 17<> 

Cecil v. Clark (49 W. Va. 459, 39 S. E. 202 , 48 

Central Coal, etc., Co. v. Penny (173 Fed. 340, 97 C. C. A. 600) 207 

Central of Ga. Ry. v. Hall (124 Ga. 322, 4 L.R.A. (X.S.) 898 320 

Central Ohio Natural Gas, etc., Co. v. Eekert (70 Ohio 127, 71 N. E. 

281 ) '....- ';. 53, 90 

Chandler v. French (73 W. Va. 658. L.R.A.1915B, 561, 81 S. E. 825) 

85, 110 

v. Hart (161 Cal. 405, Ann. Cas. 1913B, 1094, 119 Pac. 516) .. 

oo, 57, 66, 86, 88, 106, 117 

Chaney v. Ohio, etc., Oil Co. (32 Ind. 193, 69 X\ E. 477) 92 

Chapman v. Pfarr ( 145 Iowa 196, 123 N. W. 992 ) 164 

Chartiers Block Coal Co. v. Mellon (152 Pa. St. 286, 34 Am. Rep. 

645, 18 L.R.A. 702, 25 Atl. 597 ) . 19 

Cheek v. Missouri K. & T. Railway Co. (89 Kan. 247, 131 Pac. 617 I . . 25 

Cherokee, etc., Mining Co. v. Limb (47 Kan. 469. 28 Pac. 181) 25 

Cherokee Nation v. Georgia (5 Peters 1, 8 L. ed. 25) 976 

Cheeseman v. Hart ( 42 Fed. 98, 16 M. R. 263 ) 230 

v. Shreve (40 Fed. 787, 17 M. R. 260) 230 

Chicago & A. Oil, etc., Co. v. United States Petroleum Co. (12 M. R. 

570, 57 Pa. 83 ) 56, 60, 121, 200 

Chicago, Rock Island & Pacific Railway Co. v. Lawton Refining Co. 

( 253 Fed. 705 ) 170 

v. Rhodes (35 Tex. Civ. App. 432, 80 S. W. 869) 173 

Childers v. Neely (47 W. Va. 70, 81 Am. St, Rep. 777, 49 L.R.A. 468, 

34 S. E. 828, 20 M. R. 222 ) 139, 140 

Chino Land & Water Co. v. Hamaker (178 Pac. 738) (Cah) 8 

Christie's Appeal <85 Pa. 463, 9 M. R. 42) 126. 129 

Christopher v. New York (13 Barb. (N. Y. ) 567. 573) 327 

City of Butte v. Paltrovich (74 Pac. 521) (Mont.) 327 

Des Moines v. Hall ( 24 Iowa 234 ) 13 

Du Buque v. Benson (23 Iowa 248 ) 14 

Knoxville v. Knoxville Water Co. (212 U. S. 1, 53 L. ed. 371, 29 

Sup. Ct. Rep. 148) 161 

La Harpe v. Elm Tp. Co. (76 Pac. 448. 69 Kan. 97) 161. 166 

Leadville v. Bohn Mining Co. (37 Colo. 248, 11 Ann. Cas. 443, 8 

L.R.A. (N.S. ) 422. 86 Pac. 1038 ) ' 13 

Lincoln v. Lincoln Gas. etc., Co. (100 Neb. 182. 158 X. W. 962) 159 

Portland v. Portland Gas Co. (80 Or. 271, 156 Pac. 1070, 150 

Pac. 273 ) 158 

Pueblo v. Public Utilities Commission (187 Pac. 1026V (Colo.) 162 



TABLE OF CASES CITED 989 

PAGE 
Clarksburg Co. v. Public Service Commission (100 S. E. 551) (W. Va. ) 102 

Clarno v. Grayson (30 Or. Ill, 46 Pae. 426) 125 

Clavering v. Wavering (2 P. Wms. 388, 24 Eng. Repr. 780, 14 M. R. 

358) 144 

Clay v. Palmer (177 N. W. 840) (Neb.) 16, 57 

Clement v. U. S. P. L. Co. (253 Pa. 187, 97 All. 1070) 168 

Clements v. Philadelphia Co. (184 Pa. 28, 39 L.R.A. 532, 38 Atl. 1090) 

3 67 

Cleveland v. Citizens' Gas Light Co. (20 N. J. Eq. 201 ) 178 

Coad v. Pennsylvania Railway (175 N. W. 344) (Iowa) 137, 170 

Coal District Power Co. v. Katy Coal Co. (217 8. W. 149) (Ark.) .. 211 

Coalinga Hub Oil Co., In re (40 L. D. 401 ) 237 

Coalinga Pacific Oil & Gas Co. v. Associated Oil Co. (16 Cal. App. 361, 

1.16 Pac. 1107) 101 

Cochran v. Gulf Refining Co. (139 La. 1010, 72 So. 718) 118, 122 

v. Pew ( 159 Pa. 184, 28 Atl. 219) 130 

Cochrane v. Justice Mining Co. (16 Colo. 415, 26 Pac. 780) 203, 

Colin v. Clark ( 48 Okla. 500, 150 Pac. 467 ) 77 

Colby, In re ( 169 N. W. 443) (Iowa) 354 

Cole v. Cady (2 Dak. 29, 3 N. W. 322) 1 ;)9 

■ v. Ralph (40 Sup. Ct. Rep. 321) 230, 231, 243, 36 » 

Coleman's Appeal (62 Pa. 252, 14 M. R. 221) 46 

Colgan v. Forest Oil Co. (194 Pa. 234, 75 Am. St, Rep. 695, 45 Atl. 

119, 20 M. R. 338) 35.38,42, 86 

Collier v. Monger (75 Kan. 550, 89 Pac. 1011) 136 

Collins v. Chartiers Valley Gas Co. (131 Pa, 143, 17 Am. St. Rep. 

791, 6 L.R.A. 280, 18 Atl. 1012 ) 30, 171 

v. Mt. Pleasant Oil & Gas Co. (85 Kan. 483, 38 L.R.A. (N.S.) 134, 

118 Pac. 54) 93, 180 

Colm v. Francis (30 Cal. App. 742, 159 Pac. 237) 202, 250 

Columbia Gas & Electric Co. v. Moore (81 W. Va. 164, 93 S. E. 1051) 

195 

Columbus Gas Light & Coke Co. v. Freeland (12 Ohio St. 392) 178 

Commins v. Guaranty Oil Co. (29 Cal. App. 139, 154 Pac 882) 10'* 

Commonwealth v. Standard Oil Co. (129 Ky. 546, 112 S. W. 632) .. 163 

v. Trent (117 Ky. 34, 4 Ann. Cas. 209, 77 S. W. 390) 187, 188 

Compton v. People's Gas Co. (75 Kan. 572, 10 L.R.A. (N.S.) 787, 89 

Pac. 1039 ) ; 47, 103 

Conkling v. Krandusky (127 App. Div. (N. Y. ) 761, 112 N. Y. Supp. 

13) Ill 

Consolidated Coal Co. v. Baker (135 111. 545, 12 L.R.A. 247, 26 N. E. 

651 ) 156 

Consolidated Gas Co. v. City of New York (157 Fed. 849) 162 

Consolidated Mutual Oil Co. v. United States (245 Fed. 52J, 525, 157 

C. C. A. 633) ^.^u^m.... 224, 226, 231, 237, 258, 259 



990 TABLE OF CASES CITED 

PAGE 
Consumers' Gas Trust Co. V. American, etc. Glass Co. (162 Ind. 393, 

68 N. E. 1020) 14, 33, 146, 182, 197. 19S 

■ v. Crystal Window Glass Co. (63 Tnd. 190, 70 X. E. 36o*) .. 87, 1!'"> 

v. Harless (131 hid. 446, 15 L.R.A. 505, 129 N. E. 3062) 165 

v. Ink (163 Ind. 174, 71 N. E. 477) 87 

v. Littler ( 102 Ind. 320, 70 N. E. 363 ) 24, 83, 86 

v. Worth (163 Ind. 141, 71 N. E. 489) 78, 86, 87, 97 

Cook, In re (33 L. D. 109 ) , 513 

Cook v. Klonos (168 Fed. 700, 94 C. C. A. 144) 238 

Cooke v. Gulf Refining Co. (127 La. 592, 53 So. 874) 28, 02 

v. ( 135 La. 609, 65 So. 758 ) m 

Copper State Mining Co. v. Kidder (179 Pac 641) (Ariz.) 243 

Core v. New York Petroleum Co. (52 W. Va. 276, 43 8. E. 128) . . 118. 119 

Cortelyou v. Barnsdall (236 111. 138, 86 N. E. 200) 120 

v] (140 111. App. 163 ) . v 128 

Courtney v. Ward ( 187 Pac 517 ) ( Colo. ) 234 

Cox v. Butts (48 Okla. 147, 149 Pac 1090) 104, 106 

Crawford v. Bellevue, etc, Natural Gas Co. (183 Pa. 227, 38 Atl. 595) 150 

Crocker v. Malley ( 250 Fed. 817 ) 914 

v. (249 U. S. 223) 915 

Crystal Ice, etc, Co. v. Marion Gas Co. (35 Ind. App. 295, 74 N. E. 

15): 201 

Culbertson v. Iola Portland Cement Co. (87 Kan. 529, Ann. Cas. 

1914A, 610, 125 Pac 81) 34, 38, 39, 163 

Cullum v. Wagstaff (48 Pa. 300) 137 

Curtis v. Harris ( 184 Pac 574 ) (Okla, ) 62, 116 



Daniel Boone Co. v. Miller (217 S. W. 666) (Ky. ) 81 

Dangerfield v. Caldwell (151 Fed. 554, 81 C. C. A. 400) 47, 205 

Dark v. Johnston (55 Pa. 164, 93 Am. Dec 732, 9 M. R. 283) . . 7, 20, 

22, 130. 192 
Daughetee v. Ohio Oil Co. (263 111. 518, 105 N. E. 308) .. 33, 59, 

88, 92, 209 

v. ( 151 111. App. 102 ) 20? 

Davidson v. Humes (188 Pa. 335, 41 Atl. 649) 180 

Davis v. Chautauqua Oil & Gas Co. (78 Kan. 97, 96 Pac 47) 118 

■ v. Jefferson Gas Co. (147 Pa. 130. 23 Atl. 218) 160 

— v. Riddle (25 Colo. App. 102. 130 Pac 551) 117 

Day v. Kansas City Pipe Line Co. (87 Kan. 617, 125 Pac 43) 84 

Dean v. Omaha- Wyoming Oil Co. (21 VVyo. 133, 128 Pac 881, 129 

Pac 1023) 222. 228, 229, 242 

Dearden v. Evans (5 M. & W. 11, 151 Eng. Repr. 5) , 20 

Decatur v. Paulding (14 Pet. 497, 515) 253 



TABLE OF (ASKS CITED 991 

PAGE 

Decker v. Kirklicks (216 S. W. 385 ) ( Tex. ) 89, 1 1 3 

Deffenbaugh v. Hess (225 Pa. (538, 36 L.RA.(X.S.) 105)0. 74 Ail. 60s) 45 
De Hart v. Enright (93 Misc. Hep. (N. Y.) 213; 1.17 X. Y. Supp. 46} .. 140 

Delaney's Estate, In re (41 Ney. 384, 171 hie 383 ) 241 

Delaware Canal Co. v. Hughes (183 L'a. 66. 63 Am. St. Rep. 743, 38 

L.R.A. 826, 38 Atl. 568 ) 14S 

Delaware, etc., Railroad Co. v. Sanderson (100 Pa. 583, 58 Am. Rep. 

743, 1 Atl. 394 ) 1 60 

Dellinger v. Smith (142 La. 1009, 77 So. 947) 121 

De Moss v. Sample (143 La. 243, 78 So. 482) 8 

Denniston v. Kenova Oil Co. (220 S. \V. 1078) (Ky.) ". 216 

Derry v. Ross (5 Colo. 295, 1 M. R. 1 ) . . 110 

Des Moines, City of v. Hall (24 Iowa 234 ) 13 

Des Moines Gas Co. v. Des Moines (238 U. S. 153) 162 

Detlor v. Holland (57 Ohio St. 492, 40 L.R.A. 266, 49 N. E. 690) ... 8 

Develand v. Develand (74 Pae. 274) (Kan.) 327 

Devil's Den Oil Co. v. United States (251 Fed. 554, 163 C. C. A. 542) 

253, 254 

Devitt's Estate, In re (109 Atl. 699) (Pa. ) 160 

Diamond Plate Glass Co. v. Curless (22 Ind. App. 346, 52 N. E. 782, 

19 M. R. 682) : 52 

v. Eehelbarger ( 24 Ind. App. 124, 55 N. E. 233 ) 52 

■ v. Tennell (22 Ind. App. 132, 52 N. E. 168) 16, 64 

Dickey v. Coffeyville, etc., Tile Co. (69 Kan. 106, 76 Pac. 398) .. 51. 

52, 59 

v. Linscott (22 Me. 453, 37 Am. Dec. 66 ) 320 

Dietz v. Mission Transfer Co. (3 Cal. Unrep. 354, 25 Pac. 423) 148 

v. Nix (216 S. W. 791) (Mo.) 133, 136 

Dill v. Fraze (169 Ind. 53, 79 N. E. 971) 41, 82, 05, 115, 122, 155 

Dillon v. Bayliss ( 11 Mont. 171, 27 Pae. 725) 233 

Dinsmoor v. Combs (177 Ky. 740, 108 S. W. 58) 35, 37, 82, 88 

Doane v. Rising Sun Mining Co. (213 S. W. 309) (Ark.) 63 

Dobbins v. Economic Gas Co. (189 Pac. 1073 ) 212 

Doddridge County Oil & Gas Co. v. Smith (154 Fed. 970, 173 Fed. 

386) 38, 114, 131 

Donovan v. Territory (2 Pac. 532) ( Wyo. ) 328 

Double v. Union Heat, etc., Co. (172 Pa. 388, 33 Atl. 694, 18 M. R. 327) 79 

Double Eagle Mining Co. v. Hubbard (183 Pac. 282) (Cal.) 240, 243 

. Dougherty v. Creary (30 Cal. 290, 89 Am. Dec. 116, 1 M. R. 36) 140 

Downey v. Gooch (240 Fed. 527) 39, 64, 103, 127 

Downman v. Texas (231 U. S. 353, 58 L. ed. 264, 34 Sup. Ct. Rep. 62) 156 

Dripps v. Allison's Mines Co. (187 Pac. 448) (Cal.) 234, 235 

Du Buque, City of v. Benson (23 Iowa 248) 14 

Ducie v. Ford (138 U. S. 587, 34 L. ed. 1091, 11 Sup. Ct. Rep. 417) . . 249 
Duff v. Keaton (33 Okla. 92, 42 L.R.A. (M.S.) 472, 124 Pac. 291) ... 58 



1*92 TABLE OF CASES CITED 

PAGE 

Duffield v. Hue (17 M. R. 253, 129 Pa. 94, 18 Atl. 566) 56, 62, 120 

V. (136 Pa. 602, 20 Atl. 526) 197 

v. Rosenzweig (141 Pa. 520, 23 Atl. 4) 193, 197, 208, 211, 212 

Duke v. Hague ( 107 Pa. 57 ) 60, 206 

Dunaway v. Galbraith (214 S. W. 33 ) (Ark.) 76, 80 

Duncan v. Keechi Oil & Gas Co. (1S1 Pac. 709) (Okla.) 146 

Dunham v. Kirkpatrick (101 Pa. 36, 47 Am. Rep, 6^6) 8 

Durant v. Corbin (94 Fed. 382, 20 M. E. 84) 237 

Duryea v. Burt (28 Cal. 569, 11 M. R. 395) 139 

Dyke v. National Transit Co. (43 N. Y. Supp. 180, 22 App. Div. (N. 

Y.) 360) 208 

£ 

Early v. Friend (16 Grat. (Va.) 21, 78 Am. Dec. 649, 14 M. R. 271) 46 
East' End Oil Co. v. Pennsylvania Torpedo Co. (190 Pa. 350, 42 Atl. 

707 ) : 186 

Eastern Oil Co. v. Beatty (177 Pac. 104) (Okla.) 38, 79 

v. Coulehan (65 W. Va. 531, 64 S. E. 836) ... 24, 51, 89, 110, 121 

v. Holcomb (212 Fed. 126, 128 C. C. A. 642) 107 

East Jersey Iron Co. v. Wright (32 N. J. Eq. 248) 112. 131 

Eaton v. Wilcox (42 Hun (N. Y.) 61) . 31, 51, 55 

Eclipse Oil Co. v. South Penn Oil Co. (47 W. Va. 84) 78 

Edmonds v. Mounsey (15 Ind. App. 399, 44 N. E. 196, 18 M. R. 384) . . 

77, 80, 94, 106, 116 

Ehrhart v. Mahony ( 184 Pac. 1010) (Cal. ) . . 202 

Eisner v. Macomber (40 Sup. Ct. 189) 160 

Elder v. Wood (208 U. S. 226, 52 L. ed. 464, 28 Sup. Ct. 263) 156 

El Dora Oil Co. v. United States (229 Fed. 946, 144 C. C. A. 228) . . r . 251 

Elk Fork Oil & Gas Co. v. Jennings (84 Fed. 839 ) 197 

Elk Nat, G. Co. v. Ridgway Light Co. (261 Pa. 295, 104 Atl. 546) .. 138 
Ellen wood v. Marietta Chair Co. (158 N. S. 105, 39 L. ed. 913, 15 

Sup. Ct. 771 ) • 189 

Ellis v. Treat (236 Fed. 120, 149 C. C. A. 330) 204 

Elliot v. Crystal Springs Oil Co. (187 Pac. 692) (Kan.) 52. 116 

Elwood Oil Co. v. McCoy (179 Pac. 2) (Okla.) '. 133 

Ely v. Wichita N\ G. Co. (99 Kan. 236, 161 Pac. 64t) ) 138 

Emde v. Johnson (214 S. W. 575) (Tex.) 126, 195 

Emerson v. Com. ( 108 Pa. Ill, 126 ) 130 

Emery v. League (31 Tex. Civ. App. 474, 72 S. W. 603) 66, 206 

Empire Trans. Co. v. Wamsutta Oil, etc., Co. (63 Pa. 14, 3 Am. Rep. 

515) 173 

Enterprise Oil & Gas Co. v. National Transit Co. (172 Pa. 421, 51 

Am. St. Rep. 746, 33 Atl. -687, 18 M. R. 312) ii^- 



TABLE OF CASES CITED 99^ 

PAGK 

Erie Railway Co. v. Collins ( 259 Fed. 172) 173 

Erskine v. Forest Oil Co. (86 Fed. 583, 18 M. R. 297) 193, 196 

Evans v. Haefner ( 2!) Mo. 141 ) 13 



Fagan v. Silver ( 188 Pac. DOG | (Mont. ) 1 7*i 

Fairbanks v. Warrum (56 hid. App. 337, 104 N. E. 938, 1141) 102 

Farmers' & Merchants' State Hank v. Tullos (21 S. W. 847) (Tex.) . . 108 

Fast v. Whitney ( 187 Fac. 192 ) ( Wyo ) 84 

Feather v. Baird ( 102 S. E. 294) ( W. Va.) 17 

Federal Betterment Co. v. Blaes (88 Pac. 555) (Kan.) 134 

Federal Oil Co. v. Western Oil Co. (121 Fed. 674, 57 C. C. A. 428, 22 

M. R. 429 ) 203-204 

Findlay v. Smith (6 Munf. 134, 13 M. R. 182) 10 

Finley v. Heinze ( 69 Pac. 829 ) (Mont. ) '. 328 

Finnerty v. Fritz (5 Colo. 174, 1 M. R. 437) 126 

First National Bank v. Harkness (42 W. Va. 156, 32 L.R.A. 408, 24 

S. E. 548 ) 137 

Flamang's Case (Unreported.) See Mitchell v. Dors 194 

Fleming Oil & Gas Co. v. South Penn Oil Co. (37 W. Va. 645, 17 S. 

E. 203 ) 84 

Florence Oil & Refining Co. v. Orman (19 Colo. App. 79, 73 Pac. 628) 21 

Forbes v. Gracey (94 U. S. 762, 24 L. ed. 313, 14 N. E. 183) . 156 

Ford v. Buchanan (111 Pa. 31, 2 Atl. 339) 25 

v. Campbell (29 New 578, 92 Pac. 206 ) 874 

Forsyth v. North American Oil Co. (53 Pa. 168, 11 M. R. 115) 137 

Foster v. Elk Fork Oil & Gas Co. (90 Fed. 178, 32 C. C. A. 560) 112 

Fowler v. Delaplain (79 Ohio St, 279, 21 L.R.A. (N.S.) 100, 89 X. E. 

260 ) 109 

Francis v. West Virginia Oil Co. (174 Cal. 168, 162 Pac. 394) 127 

Frank Oil Co. v. Belleview Gas, etc., Co. (29 Okla. 719, 43 L.R.A. 

(N.S.) 487, 119 Pac. 260) 21, 23, 59, 62, 122, 128 

Fredenhall v. Schrader ( 188 Pac. 580) 152 

French v. Brewer (3 Wall. Jr. 346, Fed. Cas. No. 5, 196, 11 M. R. 108) 

7, 195 

Friend v. Porter ( 50 Mo. App. 89 ) 13 

Frishelkn v. Fitzgerald (25 Colo. 290, 53 Pac. 1109) 234 

Frost v. Martin (203 S. W. 72 ) (Tex. Civ. ) 83 

Fulton v. Messinger (61 W. Va. 477, 56 S. E. 830) 956 

Funk v. Haldemau (53 Pa. 229 ) 57, 58 



Gaber v. Hauser ( 185 Pac. 436) (Okla.) 95 

M O. R.— 63. 



994 TABLE OF CASES CITED 

PAGE 
Gadbury v. Ohio Oil & Gas Co. (162 Ind. 9, 62 L.R.A. 895, 67 N. E. 

259, 22 M. R. 680) 82, 84, 94, 115, 117 

Gaffney v. Stowers ( 73 W. Va. 420, 80 S. E. 501) 100 

Gagnon v. French Lick, etc., Co. (163 Ind. 687, 68 L.R.A. 175, 72 N. 

E. 849) 187 

Gaines v. Chew (167 Fed. 630) 146 

Galey v. Kellermari (123 Fa. 49J, 16 Atl. 474, 17 M. R. 164) ...... 77, !>•"> 

Gamble v. Nanchett (34 New 351, 126 Fae. Ill ) . 146 

Gamer v. Glenn (8 Mont. 371, 20 Fac. 654, 2 L.R.A. 813) 233 

Garden Gulch Flacer (38 L. D. 28) 242. 246 

Garfield Oil Co. v. Champlin (189 Pac. 514) (Okla.) 61, 62, 63 

Garrett v. South Fenn Oil Co. (66 W. Va. 587, 66 S. E. 741) ... 24, 

80, 104, 110, 113 

Gartland v. Hickman (56 W. Va. 75, 49 S. E. 14, 67 L.R.A. 694) 180 

Gem Oil Co. v. Callendar (173 Fac. 820) (Okla.) 72 

General Oil Co. v. Grain (209 U. S. 211, 52 L. ed. 754, 28 Sup. Ct. 

• Rep. 475) 16-i 

Georgia Steel Co., In re ( 240 Fed. 473, 474 ) 152 

Gerkins v. Kentucky Salt Co. (100 Ky. 734, 39 S. W. 444, 66 Am. 

St. Rep. 370) 44 

German American Insurance Co. v. Hyman (42 Colo. 156, 94 Fac. 27, 

16 L.R.A. (X.S. ) 77 ) 211 

Gilbert v. Bolds (62 Ind. App. 595, 113 N. E. 379) 88 

Gillespie v. American Zinc, etc., Co. (247 Fa. 222, 93 Atl. 272) 84 

v. Fulton Oil & Gas Co. (236 111. 188, 86 N. E. 219) 97, 98, 152, 

187, 193, 197 

v. (239 111. 326, 88 N, E. 192 ) 22, 179, 199 

v. ( 140 111. App. 147 ) 49, 128 

Gillette v. Mitchell (214 S. W, 619) (Tex. Civ.) 102, 116, 168 

Ginaca v. Peterson ( 265 Fed. 904 ) 418 

Gird v. California Oil Co. (60 Fed. 531, IS M. R. 45) 30, 238, 241 

Given v. State (160 Ind. 552, 66 N. E. 750) 187 

Gladys City Oil, etc., Co. v. Right of Way Oil Co. (137 S. W. 171) 

( Tex. ) 210 

Glasgow v. Chartiers Oil Co. (152 Pa. 48, 25 Atl. 232, 17 M. R. 

523 ) 75, 78, 79 

Gohres v. Illinois, etc., Mining Co. (40 Or. 516, 67 Pac. 666 i .:.... 239 
Gold Creek, etc., Mining & Smelting Co. v. Perry (94 Wash. 624, 162 

Fac. 996 ) 243 

Golfield Consolidated Mines Co. v. Scott (247 U. S. 126, 62 L. ed. 

1022, 38 Sup. Ct, 565) 15!) 

Gonzales v. Cowerd ( 188 Fac. 1053) (Okla.) 84 

Goodlander Mill Co. v. Standard Oil Co. (63 Fed. 400, 11 C. C. A. 253, 

27 L.R.A. 583 ) 173 

Gordon v. Darnell (5 Colo. 302, 2 M. R. 220) 326 



TABLE OF CASKS CITED 99f> 

PAGE 

Graciosa. Oil Co. v. Santa Barbara County (155 Cal. 140, 99 Pac. 483, 

20 L.R.A. (X.S.) 211) J5« 

Great Southern Gas Co. v. Logan X. Oils Co. (155 Fed. 114. 83 C. C. 

A. 574) . ... . . 207 

Greek v. Wiley ( 109 Atl. 529 ) (Pa. ) 51 

Green v. Davis ( 185 Pac. 369 ) ( Colo. ) 1 93 

v. Gavin (10 Cal. App. 330, 101 Pac. 931 ) 236 

Greene v. Robi nson (210 S. W. 498 ) ( Tex. ) 248 

Griffin v. Bell (202 S. W. 1034) (Tex.) 49, 71, 72 

Grimes v. Goodman Drilling Co. (216 S. W. 202) (Tex.) 177 

Grubb v. Bayard (2 Wall. Jr. 81, Fed. Cas. Xo. 5, 849, 9 M. R. 199) 

57, 130 

v. McAfee (212 S. W. 464) (Tex.) Ill 

Guffey v. Smith (237 U. S. 101, 59 L. ed. 856, 35 Sup. Ct. Rep. 526) 

75, 105, 193, 198, 208 
Guffey, J..M., Petroleum Co. v. Jeff Chaison T. Co. (48 Tex. Civ. App. 

oo^, 107 S. W T . 603 ) 34, 37 

Gulf C. & S. F. Railway Co. v. Clement (220 S. W. 407) (Tex.) . . 172, 174 

Gulf Oil Corporation v. Lewellyn (246 Fed. 209) . 159 

Gulf Pipe Line Co. v. Pawnee-Tulsa P. Co. (34 Okla. 775, 127 Pac. 

252, 41 L.R.A. (X.S.) 1108 84 

Gulf Refining Co. v. Carrol (145 La. 299, 82 So. 277) 46 

v. Hayne (138 La. 555, 70 So. 509, L.R.A.1916D, 1147, Ann. Cas. 

1017D, 130) 205 

Gypsy Oil Co. v. Cover (189 Pac. 540) (Okla.) 56 

H 

Hague v. Wheeler (157 Pa. 324, 27 Atl. 714, 22 L.R.A. 141, 37 Am. St. 

Rep. 736) 187 

Hahn v. Southwestern Gas Co. (145 La. — , 82 So. 199) 172 

Haight v. Conners (149 Pa. St. 297, 24 Atl. 302) 150 

Hail v. Reed ( 15 B. Mon. Ky. 479, 11 M. R. 103) 6, 201 

Hall v. Geiger-Jones Co. (242 U. S. 539-590) 811 

Hall v. MeKinnon (133 Fed. 572, 13 C. C. A. 440) 237 

v. Philadelphia Co. (72 W. Va. 573, 78 S. E. 755) 188, 202 ( 

v. Vernon (47 W. Ya. 295, 34 S. E. 764, 49 L.R.A. 464, 81 Am. 

St. Rep. 791 ) 205 

Hancock v. Diamond Plate (-lass Co. (102 Ind. 146, 70 N. E. 149) 

203, 52 

v. (37 Ind. App. 351, 75 X. E. 659 ) 100 

Hanley v. Federal Mining, etc., Co. (235 Fed. 769) 15H 

Harlow v. Propes ( 102 Kan. 424, 170 Pac, 983 ) 171 

Harper v. Sloan (177 Cal. 174, 169 Pac. 1043) 140 

Harris v. Cobb (49 W. Va. 360, 38 S. E. 559, 21 M. R. 263) 101 



996 * TABLE 01' CASES CITED 

PAGE 

-v. Equator Co. (8 Fed. 863, 3 McCrary 14, 12 M. R. 178) 23L» 

v. Ohio Coal Co. (57 Ohio 118, 48 N. E. 502, 19 M. R. 157) . . 34, 118 

v. Riggs (63 fnd. App. 201, 112 N. E. 36 ) Ill 

Harvey v. Laurier Mining Co. (179 Pac. 864) (Wash.) 147 

Hashman v. Wyandotte Gas Co. (83 Kan. 328, 111 Pac. 468) ... 24. 167 

Haskell v. Cowham (187 Fed. 403, 109 C. C. A. 235) 165, 169 

-V. Kansas Natural Gas Co. (224 U. S. 217, 56 L. ed. 738, 32 

Sup. Ct. Rep. 442 ) 169 

v. Sutton (53 W. Va. 206, 44 S. E. 533) 9, 196 

Hathorn v. Natural Carbonic Gas Co. (194 N. Y. 326, 87 N. E. 504, 

23 L.R.A. (N.S.) 436, 128 Am. St. Rep. 555, 16 Ann. Cas. 

989, affirming 128 App. Div. (N. Y.) 33, 112 N. Y. Supp. 374) 184 
Hauek v. Tidewater Pipe Line Co. (153 Pa. 366, 26 Atl. 644, 20 

L.R.A. 642, 34 Am. St. Rep. 110) 167 

Hawkins v. Spokane, etc., Co. (3 Ida. 650, 33 Pac. 40) 140 

Hawsville Trustees v. Hawes Heirs (6 Bush (Ky.) 232) *. 13 

Haynie v. Stovall (212 S. W. 792) (Tex.) * 49, 104 

Hays v. Forest Oil Co. (213 Pa. 556, 62 Atl. 1072) 78, 95 

Hazzard v. Johnson (187 Pac. 121) (Cal.) 126, 146, 147, 240 

Headley v. Hoopengarner (60 W. Va. 626, 55 S. E. 744) 50, 60, 61 

Heller v. Dailey (28 Ind. App. 555, 63 N. E. 490) 22, 107, 149 

Helms v. Eastern Kansas Oil Co. (102 Kan. 164, 169 Pac. 208, L.R.A. 

1918C, 227 ) 178 

Henderson v. Ferrel (183 Pa. 547, 38 Atl. 1018, 19 M. R. 205) 84 

Henderson Traction Co. v. City of Henderson (178 Ky. 124, 198 S. W. 

730 ) 161 

Henne v. South Penn Oil Co. (52 W. Va. 192, 43 S. E. 147) . . 89, 104, 115 

Hennessey v. Junction Oil & Gas Co. (182 Pac. 666) (Okla.) 27, 91 

Henry v. Cleveland, etc., Railroad Co. (67 Fed. 426) 174 

Henry Gas Co. v. United States (191 Fed. 132, 111 C. 0. A. 612) .... 39 
Hicks v. American Nat. Gas Co. (207 Pa. 570, 57 Atl. 55, 65 L.R.A. 

209) '. . 195 

Higgiris Oil Fuel Co. v. Guaranty Co. (82 So. 206) (La.) 175 

Highbee, Estate of, In re (5 Pac. 693) (Utah) 328 

Hill Oil & Gas Co. v. White (53 Okla. 748, 157 Pac. 710) 203 

Hinton v. D'Yarmett (212 S. W. 518 ) (Tex.) 72 

Hitson v. Gilman (220 S. W. 140) (Tex.) 62, 66, 67. 69, 108 

Honolulu Cons. Oil Co. (unreported ) 250 

Mocks v. Forst (165 Pa. 238, 30 Atl. 846, 18 M. R. 139) 80 

Hopkins v. Zeigler (259 Fed. 43, 44 ) 61, 74, 101 

EJorberg v. May ( 153 Pa, 216, 25 Atl. 750) 109 

Horse Creek, etc., Mining Co. v. Midkiff (SI W. Va. 010. 93 S. K. 27) 

15. !>7!< 
Howerton v. Kansas Natural Gas Co. (S2 Kan. :;07. I OS Pac. 813. 34 

L.R.A. (N.S.) 46) .' . ... 37, 39 



TABLE OF CASES CITED 997 

PAGE 

Hoyt ▼. Fixieo (175 Pac. 517 ) (Okla. ) 217 

Hudspeth v. Producers' Oil Co. (134 La. 3013, 1018, 64 So. 89l') ... Si 
Hughes v. Busseyville Oil ft Gas Co. ( ISO Ky. 545, 203 S. W. 515) .. 

38, 124 

v. Devlin (23 (Dal. 501, 12 M. K. 241) 205 

v. Parsons (183 Ky. 584, 201) S. W. 853) 73, 82 

v. United States Pipe Lines (119 N. Y. 423, 23 N. E. 1042) 201 

Huggins v. Daley (99 Fed. 606, 40 C. C. A. 12, 48 L.R.A. 320, 20 

M. R. 377 ) 60, 79, 115 

Hunter v. Gulf Prod. Co. (220 S. W. 163) (Tex. Civ.) 60* 98, 125 

Hurd v. Wysong ( 186 Pan. 301 ) ( Wash. ) . 136 

Huston v. Cox (103 Kan. 73, 172 Pac. 992) 58, 139, 180 

Hutchinson v. Kline (199 Pa. 564, 49 Atl. 312) 19 

I 

lams v. Carnegie Natural Gas Co. (194 Pa. 72, 45 Atl. 54, 20 M. R. 

335) 91 

Igo Bridge Placer, In re (38 L. D. 281) 237 

Independent Land Co. v. Lavelle (47 L. D. 169) 252, 253 

Indiana Co. v. Gold Hills Co. (35 Nev. 158, 126 Pac. 965) 874 

Indiana Natural Gas & Oil Co. v. Beales (166 Ind. 684, 76 N. E. 520) - 

53, 98 

v. Granger (33 Ind. App. 559, 70 N. E. 395) 78, 90 

v. Jones ( 14 Ind. App. 55, 42 N. E. 487.) 24 

v. Leer ( 34 Ind. App. 61, 72 N. E. 283 ) 124 

v. Wilhelm (44 Ind. App. 100, 86 N. E. 86) 27 

Indiana Oil, Gas & Development Co. v. McCrory (42 Okla. 136, 140 

Pac. 610) 210 

Indianapolis Gas Co. v. Teters (15 Ind. App. 475, 44 N. E. 540, 18 

M. R. 391) 100 

Indianapolis Natural Gas Co. v. Kibbey (135 Ind. 357, 35 N. E. 392, 

17 M. R. 677 ) 55, 63, 196 

.International Mercantile Marine Co. v. Eels (164 Fed. 337; 172 

J 

Jackson, Ex parte (263 Fed. 110) 821 

Jackson v. O'Hara (183 Pa. 233, 38 Atl. 624, 19 M. R. 153) 77 

v. Pure Oil Co. (217 S. W. 959) (Tex.) 60, 79, 125, 153 

Jameson v. Chanslor-Canneld, etc., Oil Co. (170 Cal. 1, 167 Pac 369) 

64, 123 
Jamieson v. Indiana Natural Gas Co. (128 Ind. 555, 28 N. E, 76, 

12 L.R.A. 052 ) 24, 138, 1 67. 183 

Jamison Coal, etc, Co. v. Carnegie Natural Gas Co. (77 W. Va. 30, 

87 S. E. 451 ) 8 



1)98 TABLE OF CASES CITED 

PAGE 

Jegon v. Vivian (L. R. 6 Ch. App. 742, 8 M.R. 628) 458 

Jennings-Heywood Oil Syndicate v. Home Oil, etc., Co. (113 La. 383, 

37 So. 1) 20 j 

v. Houssierre Latreille Co. (119 La. 793, 44 So. 481) 64, 7* 

/fens-Marie Oil Co. v. Rixse (178 Pac. 658) (Okla. } 97 

Job v. Pottqn (L. R. 20 Eq. 84, 14 M. R. 329 i 47. 131 

Jolinson v. Armstrong (81 W. Va. 399, 94 S. E. 753; .. . 58, 118. 120. 122 

v. Clark (174 Cal. 582, 163 Pac. 1004) :'.-../ 127 

v. Geddes (49 Utah 137, 161 Pac. 910) 136 

v. Hinkle (29 Cal. App. 78, 154 Pac. 487) 147, 212, 232, 259 

v. Russel (220 S. W. 352) (Tex.) 67 

■ v. Sidey ( 59 Ind. App. 678, 109 N. E. 934) 181 

Johnston v. Shaffer ( 176 Pac. 901 ) (Okla. ) 4 62 

Johnston's Appeal (7 Atl. 167, 15 M. R. 556) (Pa.) 165 

Johnstown Iron Co. v. Cambria Iron Co. (32 Pa. 241, 72 Am. Dec. 

783, 9 M. R. 226 ) 58 

Jones v. Forest Oil Co. (194 Pa. 379, 44 Atl. 1047, 48 L.R.A. 748) .. 183 

v. Mount ( 30 Ind. App. 59, 63 N. E. 798) 16 

v. Mac Corquodale ( 218 S. W. 59 ) ( Tex. ) 150 

v. Pearl M. Co. (20 Colo. 417, 38 Pac. 700) 909 

v. Western Pennsylvania Natural Gas Co. (146 Pa. 204. 23 Atl. 

386) 115 

v. Wild Goose, etc., Co. (177 Fed. 95, 101 C. C. A. 349, 29 L.R.A. 

(N.S.) 392) . , 239 

Joseph v. Davenport (116 Iowa 268, 89 N. W. 1081, 2 M. R. 171) 141 

Judson v. Los Angeles, etc., Gas Co. (157 Cal. 168. 21 Ann. Cas. 1247, 

26 L.R.A. (N.S.) 183) 178 

K 

Kamphouse v. Gaffner (73 111. 453, 2 M. R. 256) 130 

Kansas Natural Gas Co. v. Haskell (172 Fed. 545) 163, 70! 

v. Neosho County Commissioners (75 Kan. 335, 89 Pac. 750) .. 

59, 60, 156 

Kavanaugh v. So. Ry. Co. (47 S. E. 529) (Ga.) 327 

Kearse v. Seyb (200 Mo. App. 645, 209 S. W. 635) 172 

Keen v. Logan ( 147 La, — , 84 So. 501) 7 83, 87 

Kellar V. Craig (126 Fed. 630, 61 C. C. A. 366) 34, 38, 86 

Kelleher v. City of Newburyport (227 Mass. 462, 116 X. F. 800) • • •• 174 
Kelly v. Keys (213 Pa. 295, 62 Atl. 911, 110 Am. St. Rep. 547) . . 21. 23 

v. Marshall (172 Pa. 396, 33. Atl. 690, 18 M. R. 317 ) 107 

v. Ohio Oil Co. (57 Ohio St. 317, 49 N. E. 399, 39 L.R.A. 765, 

63 Am. St. Rep. 721 ) 38 

v. T. VV. Phillips Gas & Oil Co. (262 Pa. 412, 105 Atl. 63t) 198 



TABLE OF CASES CITED 999 

PAGE 
Kern Oil Co. v. Crawford (14:; Cal. 298. 76 Pac 1111, 3 L.R.A.(N.S.) 

913) 230 

Kemp v. BaT Uas Co. (103 Kan. 505, 175 Pac. 988 ) 24. 50 

Kennedy v. Burns ( 101 S. E. 156) ( W. Va.) 14!), 204 

v. Crawford ( 138 Pa. 561 ) 90 

■ v. Ohio Fuel Co. ( 101 S. E. 150) (W. Va. ) 9 

Kennicott v. Wayne County (16 Wall. 452, 471 ) 325 

Kentucky Diamond Mining Co. v. Kentucky, etc., Co. (141 Ky. 07. 

132 S. W. 397, Ann. Cas. 1912C, 417) ' 8 

Kepner v. Com. (40 Pa. 124 ) 329 

Kern Oil Co. v. Clotfetter ( 33 L. D. 291 ) 512 

Ketcham v. Pleasant Valley Co. (257 Fed. 274) 248 

Ketcham Coal Co. v. Pleasant Valley Coal Co. (50 Utah 395, 168 Pac 

86) 252 

Key v. Big Sandy, etc., Co. (212 S. W. 300) (Tex.) 60, 88, 134 

Kier v. Peterson (41 Pa. St. 357 ) 26 

Kimball v. Superior Court (38 Cal. App. 761, 177 Pac. 488) 155 

Kimble Oil Co. v. Keeton (31 Ky. Law Rep. 146, 101 S. W. 887) 117 

Kimbley v. Luckey (179 Pac. 928) (Okla.) 102 

King v. Cants (186 Pac. 960) (Okla.) 202 

Kingsley v. Hillside Coal, etc., Co. (144 Pa. 613, 23 Atl. 250) 148 

Kinnaird v. Standard Oil Co. (89 Ky. 468, 12 S. W. 937, 7 L.R.A. 

451, 25 Am. St. Rep. 545) 178 

Kinsman v. Utah Gas, etc., Co. (177 Pac. 418) (Utah) 178 

Kirk v. Mattier ( 140 Mo. 23, 41 S. W. 252 ) 192 

v. Olson (245 U. S. 225, 38 Sup. Ct. Rep. 114) 

Kirlicks v. Texas Co. (201 S. W. 687 ) (Tex.) 89 

Kitchen v. Smith (101 Pa. 452 ) 27 

Kteppner v. Lemon (176 Pa. St. 502, 35 Atl. 109, 18 M. R. 404) . . 34, 38 

v. ■ ( 197 Pa. 430, 47 Atl. 353 ) 34 

v. ■ ( 198 Pa. 581, 48 Atl. 483, 21 M. R. 275) 35 

Kline v. Guaranty Oil Co. ( 167 Cal. 476, 140 Pac. 1) 23 

Knapp. In re (47 L. D. 156 ) 252 

Knoxvillc. City of v. Knoxville Water Co. (212 U. S. 1, 53 L. ed. 

37 1 . 29 Sup. Ct, Rep. 148 ) 161 

Knoxville Gas Co. v. City of Knoxville (261 Fed. 283) 162 

Koen v. Bartlett (41 W. Va. 559, 23 S. E. 664, 31 L.R.A. 128, 56 

Am. St. Rep. 884 ; 18 M. R. 289 ) 44 

Kolachny v. Galbreath (26 Okla. 772, 110 Pac. 902, 38 L.R.A. (N.S.) 

451 ) 21. 22. 2M 

Kreps v. Brady (133 Pae. 216) 9 

Kroeger v. Martin ( 180 Pac. 955) (Okla.) 13(5 

Kwock Tan Jat. v. White (40 Sup. Ct. 566 329 



1000 TABLE OF CASES CITED 



Lafayette Gas Co. v. Kelsay (164 Ind. 563. 74 N.. E. 7) 86, 98 

La Harpe, City of v. Elm Tp. Co. (69 Kan. 97. 76 Pac. 448) 161, 166 
Lake Erie, etc., Railroad Co. v. Lowder (7 Ind. App. 537, 34 N. E. 447, 

747) 17:: 

Lake Superior Ship Canal Co. v. Patterson (30 L. I). 161) 329 

Landon v. Morehead ( 34 Okla. 701 ) 950 

v. Public Utilities Commission (234 Fed. 152) 162, 166, 16!t 

Landry v. Robison ( 219 S. W. 819 ) 13 

Lane v. Hoglund (244 U. S. 174, 61 L. ed. 1066, 37 Sup. Ct. Rep. 558) 251 

Lange v. Robinson (148 Fed. 799, 79 C. C. A. 1) 230 

Lanyon Zinc Co. v. Freeman (68 Kan. 691, 75 Pac. 995, 1 Ann. Cas. 

403) 8, 23, 50 

Lasoya Oil Co. v. Zulkey (40 Okla. 690, 140 Pac. 160) 50 

Last Chance Mining Co. v. Tuekahoe Mining Co. (202 S. W. 287) 

(Mo.) 153 

Lawrence E. Tierney Coal Co. v. Smith's Guardian (180 Ky. 815, 203 

S. W. 731) 49 

Lawson v. Kirchner (50 W. Va. 344, 40 S. E. 344, 21 M. R. 683) . . 55, 96 

Lazarus, Estate of, In re (145 Pa. 1, 23 All. 372 ) * 99 

Leadville, City of v. Bolm Mining Co. (37 Colo. 248, 86 Pac. 1038, 

8 L.R.A. (N.S.) 422, 11 Ann. Cas. 443 ) 13 

Leasing of State Lands, In re ( 18 Colo. 359 ) 32S 

Leatherman v. Oliver (151 Pa. 646, 25 Atl. 309) 77, 119 

Lee v. Vaccum Oil Co. (54 Hun (N. Y.) 156, 7 N. Y. Supp. 426) ... 168 

Leggatt v. Stewart (5 Mont. 107, 2 Pac. 320) 238 

Lenfers v. Hanke (73 111. 405, 24 Am. Rep. 263, 5 M. R. 67) 205 

Leonard v. Busch-Everett Co. (139 La. 1099, 72 So. 749) 123 

Lesamis v. Greenberg (225 Fed. 449, 140 C. C. A. 483 ) 342 

Leslie v. Leslie (50 N. J. Eq. 112 ) 325 

Letcher v. Maloney (172 Pac. 972) (Okla.) 133 

Letter of Secretary Hitchcock, In re (33 L. D. 609) 512 

Levy v. Hoffman (235 Fed. 46, 148 C. C. A. 540.) 126 

Lewis v. Fothergil (L. R. 5 Ch. App. 103, 15 M. R. 271) 45S 

Light v. United States (200 U. S. 523, 55 L. ed. 570, 31 Sup. Ct. 485) 533 
Lincoln, City of v. Lincoln Gas & Electric Light Co. (100 Neb. 182, 

158 N. W. 962 ) 159 

Lincoln Gas & Electric 'Light Co. v. City of Lincoln (223 U. S. 349, 

56 L. ed. 466, 32 Sup. Ct, Rep. 27 J ) : 161 

v. Lincoln ( 182 Fed. 926 ) \5fi 

Linden Oil Co. v. Jennings (207 Pa. 524, 56 Atl. 1074) ". . 183 

Lindlay v. Raydure (239 Fed. 928) .. 21, 58, 67. 69, 70, 75, 79. 103. 104 

Lindsley v. Natural Carbonic Gas Co. (162 Fed. 954) 184 

v . (220 U. S. 61, Ann. Cas. 3912C, 3 60, oo L. ed. 69, 31 

Slip. Ct. 337) 184 



TABLE OF CASES CITED 100 I 

PAGE 

Locke v. Russell (75 W. Ya. 602, 84 S. E. 94S) 81, 101 

Loeb v. Conley (160 Ky. 91, Ann. Cas. 19] 6B, 49, 169 S. W. 575) .. 208 
Logan Natural Gas Co. v. Great Southern Gas, etc., Co. (126 Fed. 

623, 61 C. C A. 359 ) 197 

Londondery Mining Co. v. United Gold Mines Co. (,'>!s Colo. 480, 88 

Pac. 455 1 238 

Lone Star Gas Co. v. MeCullough (220 S. W. 1114 j (Tex. Civ.) . . 87, 98 

Long's Appeal (92 Pa. 171 ) 198 

Cong v. Calloway ( 220 S. W. 414 ) (Tex. ) 153 

v. Sun Co. ( 132 La. 601, 61 So. 684) 78 

Lord Mountjoy's Case (4 Leon. 147, 9 M. R. 175) . . . 57, 106, 139 

l.urimicr v. Lewis (1 Morris (Iowa) 253, 39 Am. Dec. 462, 12 M. R. 

467 } 261 

Cos Angeles Gas. etc., Corporation v. Los Angeles (163 Cal. 621, 126 

Pac. 594) 159 

Louisiana St. Board of Health v. Standard Oil Co. (107 La. 713, 31 So. 

1015) 163 

Louisville Gas Co. v. Kentucky Heating Co. (132 Ky. 435, 111 S. W. 

874 ) 23, 199 

v. (117 Ky. 71, 77 S. W. 368, 111 Am. St, Rep. 225, 4 Ann. 

Cas. 355, 70 L.R.A. 558) 187 

Lovett v. Eastern Oil Co. (68 W. Ya. 667, 70 S. E. 707, Ann. Cas. 

1912B, 360 ) 67, 79, 97 

Lowe v. Los Angeles Suburban Gas Co. (189 Pac. 1084) (Cal.) 213 

v. Pure Oil Co. (260 Fed. 704 ) 166 

I.owther Oil Co. v. Guffey (52 W. Ya. 88, 43 S. E. 101, 22 M. R. 545) 97 
v. Miller-Sibley Oil Co. (53 W. Ya. 501, 44 S. E. 433, 97 Am. 

St. Rep. 1027, 22 M. R, 656) 60, 90, 91, 204 x 

Luse v. Boatman (217 S. W. 1096 ) ( Tex. ) 10, 15 

v. Parmer ( 221 S. W. 1031 ) (Tex. ) 10 

v. Penn (220 S. W. 303 ) (Tex. ) 16 

Lynch v. Burford (201 Pa. 52. 50 Atl. 228, 21 M. R. 611) 40 

v. Davis (79 W. Ya. 437, 92 S. E. 427, L.R.A.1917F, 566) ..". 102 

v. United States ( 138 Fed. 535 ) 253 

— v. Versailles Fuel Gas Co. (165 Pa. 518, 30 Atl. 984, 18 M. R. 

149) 117, 121 

M 

Mackey Wall Piaster Co. v. United States Gypsum Co. (244 Fed. 275 j 

126. 204 

Magnolia Petroleum Co. v. Saylor (180 Pac. 861) (Okla.) .. 67, 68. 71 

Malcomson v. Wappoo Mills ( 86 Fed. 192 ; 12 

Mallen v. Ruth Oil Co. (231 Fed. 845, 146 C. C. A. 41 ) 49 

Maloney v. Love (11 Colo. App. 288, 52 Pac. 1029, 19 M. U. 310) .... 1X2 



1002 TABLE OF CASES CITED 

PACE 

Manhattan Co. v. Carrell ( 164 Ind. 526) 91, 92 

Manufacturers' Natural pas & Light Co. v. Leslie (51 N. E. 510) 

(Ind.) 211 

v. Indiana Natural Gas, etc., Co. (155 Ind. 461, 566, 58 N. E. 851, 

21 M. R. 139, 50 L.R.A. 768, 57 X. E. 912, 20 M. K. 672) 

22, 182, 183 

-v. (156 Ind. 679, 59 N. E. 169, 60 N. E. 1080, 21 M. R. 194) 182 

,V. (155 Ind. 545, 53 L.R.A. 134, 58 N. E. 706, 21 M. R. 

102) 169 

Manville v. Parks ( 7 Colo. 128, 2 Pac. 212) 139 

Mark v. National Fire Insurance Co. (24 Hun (N. Y.) 565, affirming 

91 N. Y. 663 ) 25 

Markle v. Wilbur (200 Pa. 457, 50 Atl. 204, 21 M. R. 532) 140 

Marshall v. Mellon (179 Pa. 371, 57 Am. St. Rep. 601, 35 L.R.A. 816, 

36 Atl. 201, 18 M. R. 548) 43, 45 

Martineau v. Clear Creek Oil & Gas Co. (217 S. W. 806). (Ark.) 157 

Mary Darling Placer, In re (31 L. D. 64) '. 236 

Mason v. Norris (18 Grant's Ch. 500, 11 M. R. 140) 137 

Mathews v. People's Natural Gas Co. (179 Pa. 165, 36 Atl. 216, 18 

M. R. 552 ) 109, 115 

Mathews Slate Co. v. New Empire Slate Co. (122 Fed. 972) 125 

Matlack v. Kline (216 S. W. 323 ) (Mo.) 45 

Maud Oil Co. v. Bodkin (180 Pac. 959) (Okla.) 68, 118 

Maute v. Gross (56 Pa. 250, 94 Am. Dec. 62, 11 M. R. 123) 153 

May v. Hazelwood Oil Co. (152 Pa. 518, 25 Atl. 564) 64, 99 

Melton v. Cherokee Oil, etc., Co. (170 Pac. 691) (Okla.) 80, 117, 203 

Menefee v. Oxnam ( 183 Pac. 379 ) ( Cal. ) : 140 

Merrick v. Halsey (242 U. S. 539-590) 812 

Merrill v. Rocky Mountain Cattle Co. (181 Pac. 964) (Wyo.) 204 

Messimer's Appeal ( 92 Pa. 168 ) 193 

Mexico Wyoming Petroleum Co. v. Valentine (237 Fed. 539, 150 C. 

C. A. 421 ) 104, 147 

Mickle v. Douglas (75 Iowa 78, 39 N. W. 198, 17 M. R. 137) 180 

Midland Oil Co. v. Turner (179 Fed. 74, 102 C. C. A. 368) 200, 208 

Millan v. Bartlett (69 W. Va. 155, 77 S. E. 13) 62, 123 

v. (78 W. Va, 367, 89 S. E. 711) 107, 211 

Millar v. Mauney (219 S. W. 1028) (Ark.) 112 

Miller v. Chrisman (140 Cal. 440, 73 Pac. 1083, 98 Am. St. Rep. 63) 

228. 237 

v. Powers ( 184 Ky. 417, 212 S. W. 453) 46 

Mineral Farm Co. v. Barriek (33 Colo. 410, 80 Pac. 1055) 246 

Minner v. Minner ( 100 S. E. 509 ) ( W. Va. ) 144 

Minnesota Loan & Trust Co. v. Douglas (Pettit's Estate) (135 Minn. 

413, 161 N. W. 158) 101 

Minnetonka Oil Co. v. Haviland (55 Okla. 43, 155 Pac. 217) 174 



TABLE OF CASES CITED lOOo 

PAGE 
Mississinewa Mining Co. v. Patton ^129 Ind. 172, 28 N. E, 1113, 28 

Am. St. Rep. 203 ) 25 

Mitchell v. Cline (84 Cal. 401), 24 Pac. 104) 237 

Mitchell v. Dors (0 Vesey Jr. 147, 7 M. R. 250) 194 

v. Hutchinson ( 142 Cal. 404, 76 Pac. 55) 235 

v. Probst (52 Okla. 10, 152 Pac. 597, 599) 97, 127, 128, 130 

Mohennan v. Anthony (103 Kan. 500, 175 Pac. 070) 211 

Monarch Oil Co. v. Richardson (124 Ky. 602, 99 S. W. 668) 37 

Monfort v. Lanyon Zinc Co. (67 Kan. 310, 72 Pac. 784) 53, 80, 98 

Monroe v. Armstrong ( 96 Pa. 307 ) 89 

Montana Co. v. St. Louis Mining Co. (147 Fed. 897, 78 C. C. A. 33) . . 207 
Montana Coal, etc., Co. v. Livingston (21 Mont. 59, 52 Pac. 780) .. 158 

Moore v. Decker { 220 S. W. 773 ) (Tex. ) 56 

v. Griffin (72 Kan. 164, 83 Pac. 395, 4 L.R.A. (N.S.) 477) 82 

v. Jennings (47 W. Va. 181, 34 S. E. 793) 195, 196, 197 

v. Robbins (96 U. S. 530, 24 L. ed. 848 ) 248 

v. Sawyer ( 167 Fed. 826) 61, 107, 153, 217 

Morgan v. Oermania Fire Insurance Co. (104 Kan. 383, 179 Pac. 330, 

3 A.L.R. 794} 215 

Morrill v. American Reserve Bond Co. (151 Fed. 305) 816 

Morse v. Smyth ( 255 Fed. 981 ) 15, 146 

Mound Valley, etc., Brick Co. v. Mound Valley Natural Gas Co. (258 

Fed. 936) 138 

Muckle v. Hill (187 Pac. 943) (Idaho) 179 

Munsey v. Marnet Oil, etc., Co. (199 S. W. 686) (Tex.) .. 60, 116, 

120, 211, 240 
Murray v. Allied (100 Tenn. 100, 43 S. W. 355, 39 L.R.A. 249, 66 

Am. St. Rep. 740, 19 M. R. 169 ) 8, 19 

v. Barnhart (117 La. 1023, 42 So. 489 ) 69 

v. Haverty (70 111. 31S, 14 M. R. 325 ) 47 

Muscatine Lighting Co. v. City of Muscatine (256 Fed. 929) 162 

Myer v. Fromm ( 108 Ind. 208) 327 

Myers v. Pratt ( 255 Fed. 765 ) 230 

v. Short -zer (108 Pac. 105.. 82 Kan. 275) 100, 180 

Mc 

McClay v. Western Pennsylvania Gas Co. (201 Pa. 197. 50 Ail. 978, 

21 M. R. 760) 210 

MeCord v. Oakland Quartz Mining Co. (64 Cal. 134, 27 Pac. 863, 49 

Am. Rep. 686 ) 46 

McCray v. Miller ( 186 Pac. 1089) (Okla. ) OS 

v. (184 Pae. 781) (Okla.) 77 

McCullough v. Smith (243 Fed. 823, 156 C. C. A. 335) 63 

McDonald v. Carliu ( 163 Ind. 342, 71 N. E. 961) 188 



1004 TABLE OV CASKS CITED 

PAGE 

McEntire v. Thompson (210 S. \V. 503) (Tex.) 49, 58, 75, 151 

McFarlane v. Gulf Production Co. (204 S. YY. 460) (Tex.) 39 

McGill v. Pincsch Compressing Co. (140 Iowa 429, 118 N. W. 786. 

20 L.R.A.( X.S.i 466) 178 

MeGrath, In re (18 L. 1). 52 ) 320 

McGraw Oil & Gas Co. v. Kennedy (65 W. Va. 595. 64 S. E. 1027, 2S 

L.R.A. (X.S.) 959 ) 60, 88, 118 

McGregor v. Camden (47 W. Va. 193, 34 S. X. 936. 20 M. R. 274) .. 176 

v. Equitable Gas Co. (139 Pa. 230, 21 Atl. 13) 166 

McGufFey v. Pierce-Fordyce Oil Association (211 S. W. 335) (Tex.) .. 177 

Mcintosh v. Ropp (233 Pa. 497, 82 Atl. 949) 9, 45, 47 

McKay v. Kilcrease (220 S. W. 177) (Tex. Civ.) 68. 98 

v. Lucas (220 S. W. 172) (Tex. Civ.) 68. 106 

v. Tally (220 S. W. 167) (Tex. Civ.) 68, 94, 96, 98 

McKean Natural Gas Co. v. Wolcott (254 Pa. 323, 98 Atl. 955) . . 58, 

118, 120 

McKee v. Grimm (57 Okla. 680, 157 Pac. 308 > 76, 77, 96, 115 

v. Interstate Oil & Gas Co. ( 188 Pac. 109) (Okla. ) 21S 

McKenzie v. Moore (176 Pac. 568) (Ariz.) 231 

McKinney's Heirs v. Central Kentucky, etc., Gas Co. (134 Ivy. 239, 

120 S. W. 314, 20 Ann. Cas. 934) S 

MeKirahan v. Gold King Mining Co. (39 S. D. 535, 165 N. W. 542) . . 241 
McKnight v. Manufacturers' Natural Gas Co. (146 Pa. 185, 23 Atl. 

164, 28 Am. St. Rep. 790, 17 M. R. 429) ... 30, 33, 37, 88 
McLawson v. Paragon Refining Co. (198 Mich. 222, 161 N. W. 668) . . . 

25, 172. 174 

McLean v. Kishi (173 S. W. 502) (Tex.) 90 

McLemore v. Express M. Oil Co. (158 Cal. 559, 139 Am. St. Rep. 147. 

112 Pac. 59) 231. 369 

McMillan v. Philadelphia Co. (159 Pa. 142, 28 Atl. 220) 77 

McMillin v. Titus (222 Pa. 500, 72 Atl. 240) 57. 240 

McNeeley v. South Penn Oil Co. (58 W. Va. 438. 52 S. E. 480) ... 47. 48 

v. - (52 W. Va. 616, 44 S. E. 508) ... 48. 700 

McNish v. Stone (152 Pa. 457, 25 Atl. 732, 17 M. R. 22) . . 21, 59, 79. 84 

N 

Nabors Oil, etc., Co. v. McCormick (145 La. — , 81 So. 766) 114 

Nathan v. Porter (36 Cal. App. 356, 172 Pac. 17.0 i 142 

National Copper Co. v. Minnesota Mining Co. (57 -Midi. 83, 23 X. \Y. 

781, 58 Am. Rep. 333, 17 M. R. 44 i 147 

National Merc. Co. v. Keating (218 Fed. 477 ) 816 

National Pipe Line v. Teel (67 S. W. 545) (Tex. j 7S 

National Transit Co. v. Weston (121 Pa. 485. 15 Atl. 560, 17 M. R. 

143) 201 



TABLE OF CASES CITED 1005 

TAGK 

xTeale v. Neale (9 Wall. (U. S.) 1, 11) L. ed. 590) 202 

Nega v. Barber Asphalt Paving Co. (17 Mo. App. 294) 131 

Nelson v. Republic, etc., Iron Co. (2-10 Fed. 285, 293, 153 C. C. A. 211) 

60, 64, 94 

v. Smith (-12 Nev. 302, 170 Pac. 201, 178 Pac. 625) 232, 239 

Nevada-Sierra Oil Co. v. Home Oil Co. (08 Fed. 073. 20 M. P. 283, .. 

200, 228 
New American Oil Co. v. Troyer (106 Jnd. 402, 70 N. E. 253, 77 N. E. 

739 ) 22, 119 

New Domain Oil & Gas Co. v. McKinney (221 S. W. 245) (Ivy.) ... 44 
New England & Coalinga Oil Co. v Congdon (152 Cal. 211, 92 Pac. 

180) 228, 231 

New Martinsville Oil Co. v. Barrett Oil Co. (261 Fed. 34) 156 

New State Oil &: Gas Co. v. Dunn (182 Pac. 514) (Okla.) 62, 82 

Newton v. Kemper (66 W. Va. 130, 66 S. W. 102) 121 

Nichelson v. Smith (31 Idaho 544, 174 Pac. 1008) 127 

Nisbet v. Nash ( 52 Cal. 540 ) 205 

Noble v. AYestern Pa. Natural Gas Co. (255 Pa. 512, 100 Atl. 480) .. 138 

Nolan v. Young (220 S. W. 154) (Tex.) 69 

Norn Co. v. Snyder (187 Eed. 385, 109 C. C. A. 217) 237 

Northern Pacific Railway Co. v. Soderberg (188 U. S. 530, 47 L. ed. 

575. 23 Sup. Ct. Rep. 365 ) 261 

North Healdton Co. v. Skelley (59 Okla. 128, 158 Pac. 1180) 135 

North Jellico Coal Co. v. Helton (219 S. W. 185) (Ky.) 207 

Northup v. Ekes (17S Pac. 266) (Okla.) 172, 173 

Northwestern Improvement Co. v. Oliver County (38 N. D. 57, 164 

N. W. 315 ) 157 

Northwestern Ohio Natural Gas Co. v. Ullery (68 Ohio St. 259, 67 

N. W. 49 4 » 102 

Northwestern Oil & Gas Co. v. Branine (175 Pac. 533) (Okla.) .. 61, 

68, 71, 73, 79, 125 

Nylund v. Ward (187 Pac. 514) (Colo.) 234 

o 

O'Brecht v. Cedar Rapids Co. (170 N. W. 785) (Iowa) 171 

Ocala Oil Co. v. Hughes (219 S. W. 799) (Ky.) 83 

O'Connell v. Pinnacle Gold Mining Co. (131 Fed. 106, 140 Fed. 854) 145 

Ogden v. Hatry ( 143 Pa. 640, 23 Atl. 324) 78 

O'Hara v. Nelson (71 N. J. Eq. 629, 63 Atl. 842) 177, 198 

Ohio Gas Fuel Co. v. Andrews (50 Ohio St. 695, 35 N. E. 1059, 29 

L.R.A. 337 ) 174 

Ohio Oil Co. v. Biirch (3 24 N. E. 7s 1 I (Ind. App.) 31,"* 63, 64, 99 

v. Detamore ( 165 Ind. 243. 73 N. E 006 ) 63, 111 

v. Indiana (177 U. S. 190, 44 E. ed. 729, 20 Sup. Ot. Rep. 576, 

20 M. R. 466) 21, 22, 20, 187 



1006 TABLE OF CASES CITED 

PAGE 

v. Lane (59 Ohio St. 307, 52 N. E. 791 ) 30 

v. Westfall (43 Ind. App. 661, 88 N. E. 354 171 

Ohio Valley Oil & Gas Co. v. Irvine Dev. Co. (184 Ky. 517, 212 S. W. 

110) 75, !)i>, 118, 121 

Oil Creek & A. E. Railway Co. v. Keighron (74 Pa. 316) 173 

Oil Lease & Royalty Syndicate v. Beeler (217 8. W. 1054) (Tex.) .. 139 

Oklahoma v. Texas (40 Sup. Ct. Rep. 353 ) 32 

01 he, etc., Co. v. Olmstead ( 103 Fed. 568) 228 

Omaha Refining Co. v. Tabor (13 Colo. 41, 21 Pac. 925, 5 L.R.A. 236, 

16 Am. St. Rep. 185 ) ,131 

O'Neil v. Sun Co. (123 S. W. 172) (Tex.) 88, 109 

Ontario Natural Gas Co. v. Smart (19 Ontario 595) 8 

Oriental Oil Co. v. City of San Antonio (208 S. W. 177) (Tex.) 177 

Osborne v. Arkansas, etc., Oil Co. (103 Ark. 175, 146 S. W. 122) .. 

102, 149 

Osburn v. Finkelstein ( 126 N. E. 11 ) ( Ind. ) 91 

Ottawa Gaslight, etc., Co. v. Grahaur (28 111. 73, 81 Am. Dec. 263, 

35 111. 346 ) 178 

Owens v. Corsicana Petroleum Co. (169 S. W.,192) (Tex.) .. 62, 75, 

121, 128 

P 

Pacific Midway Oil Co. Case (44 L. D. 420) 256 

Palmer v. Truby ( 136 Pa. 556, 20 Atl. 516 ) 28 

Palmer Co. v. Police Jury (142 La. 1076, 78 So. 122) 157 

Parish Fork Oil Co. v. Bridgewater Gas Co. (42 S. E. 655, 59 L.R.A. 

566) 78 

Parker v. Riley (243 Fed. 42, 155 C. C. A. 572) 217 

Patrick v. Weston (22 Colo. 45, 43 Pac. 446) 140 

Patterson v. Clem ( 79 W. Va. 666, 9.1 S. E. 654 ) 48 

v. Kentucky (97 U. S. 501, 24 L. ed. 1115) 164 

v. Stroecker (245 Fed. 732, 158 C. C. A. 134) 49 

v. United Natural Gas Co. (263 Pa. 21, 105 Atl. 828) ... 107, 119 

Paxton v. Benedum-Trees Oil Co. (80 W. Va. 187, 94 8. E. 472) .. 8, 

47, 101, 142 

Paul v. Gloucester County (50 N. J. L. (21 Vroom) 585) 329 

Payne v. Neuval (155 Cal. 46, 99 Pac. 476) 58 

Peabody Mining Co. v. Gold Hill Mining Co. (Ill Fed. 817, 49 C. C. 

A. 637, 21 M. R. 591 ) 300 

Peden Iron & Steel Co. v. Jenkins (203 S. W. ISO) (Tex.) 209 

Pelham Pet. Oil Co. v. North (188 Pac. 1069) (Okla.) 35, 123 

Penn Gas Coal Co. v. Versailles Fuel Gas Co. (131 Pa. 522, 19 Atl. 

933) 10C 

Pennington v. Little Pirate Oil Co. (189 Pac. 137) (Kan.) 177 



TABLE OF CASES CITED 1007 

PAGF 
Pennsylvania Central Brewing Co. v. Lehigh Valley Coal Co. (250 Pa. 

St. 300, 95 Atl. 471 ) 19 

Pennsylvania Gas Co., In re (103 Misc. Rep. (N. Y.) 37, 10!) N. Y. 

Supp. 820 ) ie» 

v. Public Service Commission (225 N. Y. 397, 122 N. E. 200) .. 169 

v . ( 40 Sup. Ct. Rep. 279 ) 167 

Pennsylvania Railway Co. v. New York, etc., Railroad Co. (23 N. J. 

Eq. 157 ) 11 

People's Gas Co. v. Tyner (131 Ind. 277, 31 N. E. 59, 16 L.R.A. 443, 

31 Am. St. Rep. 433, 17 M. R. 481) 185 

Perley v. Chandler (6 Mass. 454, 4 Am. Dec. 159) 13 

Perry v. Acme Oil Co. (44 lnd. App. 207, 88 N. E. 859) . 179, 180 

Peyton v. Desmond (129 Fed. 1, 63 C. C. A. 651 ) 189 

Pfeiffer v. Brown (165 Pa. 267 ) 171 

Phillips v. Brill (17 Wyo. 26, 95 Pac. 856) 193, 229, 231 

v. Coast (130 Pa. 572, 18 Atl. 998) 193 

v. Hamilton ( 17 Wyo. 41, 95 Pac. 846) 85 

Phillips T. W. Gas & Oil Co. v. Lingenfelter (262 Pa. 500, 105 Atl. 

888 16 

Pierce Fordyce Oil Association v. Woodrum (188 S. W. 245) (Tex.) 

75, 94, 106, 128 

Pierce Oil Co. v. Phoenix Rehning Co. (190 Pac. 857) (Okla.) 905 

Pierce Oil Corporation v. City of Hope (248 U. S. 498, 63 L. ed. 210, 

139 Sup. Ct, Rep. 172) 161 

v. Schaebt (181 Pac. 731) (Okla.) 102,119,121 

Pipe Line Cases ( 234 U. S. 548 ) 905 

Pittsburgh & L. A. Irrtn Co. v. Lake Superior Iron Co. (118 Mich. 109, 

76 X. W. 395 ) 12 

Pittsburgh, etc., Gas Co. v. Ankrom (83 W. Va. 81, 97 S. E. 593) 102 

v. Richardson . ( 100 S. E. 220) fW. Va.) 99 

Pittsburgh Vitrified, etc., Brick Co. v. Bailey (76 Kan. 42, 90 Pac. 803, 

12 L.R.A. (N.S.) 745) ; 64, 67, 125, 129, 493 

Pittsburg & W. V. Co. v. Pentress Gas Co. (W. Va.) 100 S. E. 296) . . 208 

Plough v. Nelson ( 49 Utah 35, 161 Pac. 1134 ) 241 

Plumber v. Southern Oil Co. (214 S. W. 896) (Ky.) 119 

Poe v. Ulrey (233 111. 56, 84 N. E. 46) 22, 51, 67, 120 

Poncia v. Eagle ( 28 Idaho 60, 152 Pac. 208 ) 249 

Poole v. Union Trust Co. (191 Mich. 162, 157 X. YV. 430) 144 

Pope Bros. v. Bridgewater Gas Co. (52 W. Va. 252, 43 S. E. 87 ) . . 177, 197 

Portland, City of v. Portland Gas Co. (80 Ore. 271, 150 Pac. 3070) .. 158 

Possini v. St. Paul Fire Insurance Co. (188 Pac. 564) 215 

Poterie v. Poterie Gas Co. (153 Pa. 13, 25 Atl. 1107 ) 11)5 

Poterie Gas Co. v. Poterie (153 Pa. 10, 25 Atl. 1107 ) 195 

Powell v. Plank (141 Mo. App. 406, 125 S. W. 836) 179 

Powers v. Bridgeport Oil Co. (238 111. 397, 87 N. E. 381) ... 34, 119, 180 



1008 TABLE OF CASES CITED 

PAGE 

Prairie Oil & Gas Co. v. Ehrhardt (244 111. 634, 1)1 N. E. 080) 100 

v. United States (204 Fed. 798) 105. 905 

Preston v. South Penn Oil Co. (238 Pa. 301, 80 Atl. 203) S 

v. White (57 W. Va. 278, 50 S. E. 230) 9, 18, 205 

Price v. Biggs (217 8. W. 230) (Tex. ) 50, 75 

v. Black ( 120 Iowa 304, 101 N. W. 1050) 85 

Prichard v. Freeland Oil Co. (80 XV. Va. 787, 93 S. E. 871) 27, 31 

v< (75 w. Va. 450, 84 S. E. 945, L.R.A. 1915D, 1180) .. 27, 

99, 908 

Priddy v. Green (220 S. W. 243) (Tex.) 128, 149, 153 

-v. Griffith (150 111. 502, 37 N. E. 999, 41 Am. St. Eep. 397) .... 144 

v. Thompson (204 Fed. 955, 123 C. C. A. 277) 21, 22, 23 

Probst v. Bearman ( 183 Pac. 880 ) ( Okla. ) 47 

Producers! Oil Co. v. Snyder (190 S. W. 514) (Tex.) * 02 

Producers' Transportation Co. v. Railroad Commission (251 U. S. 228, 

04 L. ed. 100, 40 Sup. Ct, Rep. 130) 105, 100 

, . v . (i7 6 Cal. 499, 109 Pac. 59) \ 170 

Prowant v. Sealy (187 Pac. 235) (Okla.) . . . '. 53, 03, 05 

Public Service Commission v. Brooklyn B. Gas Co. (189 App. Div. 

02, 178 N. Y. Supp. 93) 7. . 101 

v. Iroquois Natural Gas Co. (179 N. Y. Supp. 230) 102 

Pucini v. Bumgarner (175 Pac. 537 ) (Okla.) 8(1 

Pueblo, City of v. Public Utilities Commission (187 Pac. 1020) (Colo.) 102 
Pure Oil Operating Co. v. Gulf Refining Co. (143 La. 284, 78 So. 500) 

95, 97 

Putnam v. Commonwealth Insurance Co. (4 Fed. 753, 18 Blatchf. 308) 214 

Pyle v. Henderson (55 W. Va. 122, 40 S. E. 791) . 195 

v. - (05 W. Va. 39, 03 S. E. 702) \. 103, 120, 121, 12S 



Rader v. Shaffer ( 298 S. W. 292 ) (Ky. ) 103, 149 

Railroad Com. v. Kansas City So. Ry. Co. (Ill La. — , 34 So. 487) . . 327 

Raines v. Dunson ( 145 La. 239, 82 So. 090 ) 09 

v. Weiler (101 Kan. 294, 100 Pac. 235, L.R.A.1917F, 571) 140 

Rainey v. H. C. Frlck Coke Co. (73 Fed. 389 ) 200 

Ralph v. Cole (249 Fed. 81, 101 C. C. A. 133) 230, 243 

Ralston v. Wichita. Natural Gas Co. (81 Kan. 80, 105 Pac. 430) ... 197 

Ramage v. Producers, etc., Co. (259 Pa. 491, 103 Atl. 330) 175 

Rawlings v. Armel ( 70 Kan. 778, 79 Pac. 683 ) 58 

Ray v. West Pennsylvania Natural Gas Co. (138 Pa. 570) 78 

Raydure v. Board of Supervisors (183 Ky. 84, 209 S. W. 19) .. 150, 158 

v. Lindlay (249 Fed. 075, 101 C. C. A. 585) 07, 75 

Raynolds v. Ilanna (55 Fed. 783) 144 

Rease v. Kettle (49 S. E. 150) 950 



TABIdi OF OASES CITED 1009 

PAGE 

Rechard v. Cowley (80 So. 41!) ) (Ala.) 02, 07, 75 

Keel "C" Oil Manufacturing Co. v. Board of Agriculture (222 U. S. 380, 

56 L. od. 240. 32 Sup. Ct. Rep. 152) r 164 

Keed Verner Z., In re (— L. D. — ) 300 

Reins v. Murray (22 L. D. 400) : 235 

Rembarger v. Loach ( 118 N. E. 831 ) (hid. ) 110 

Be»d v. Venture Oil Co. (48 Fed. 24S) 108, 211 

Rhodes v. Mound City Gas, etc., Co. (80 Kan. 702, 104 Pac. 851) . . 16, 00 

Rialto Xo. 2 Claim. In re (34 L. D. 44 ) 230 

Rice v. Ege (42 Fed. 661, 664, 16 M. R. 170) 01, 03, 185 

Rich v. Doneghey (177 Rac. 86) (Okla.) 21, 41, 67, 68, 73, 74, 70 

Richards v. Bayonne (61 N. J. L. 406) 327 

Richmond Natural Gas Co. v. Davenport (37 Ind. App. 25, 76 N. F. 

525) 0, 40, 43, 144 

v. Enterprise Natural Gas Co. (31 Ind. App. 222, 66 N. E. 782) 

182, 183 

Ricker v. American L. & T. Co. (140 Mass. 346) 012 

Riddle v. Keechi Oil & Gas Co. (176 Rac. 737) (Okla.) 56, 70 

Right of Way Oil Co. v. Gladys City Oil, etc., Co. (106 Tex. 04, 157 

S. \V. 737, 51 L.R.A. ( N.S. ) 268 ) 15 

Ringle v. Quigg (74 Kan. 581, 87 Rac. 724) 53, 65, 05 

Risch v. Burch (175 Ind. 621, 05 N. E. 123) 53, 115, 107 

Riverside, etc., Co. v. Hardwick (16 N. M. 470, 120 Pac. 323) ... 237, 238 

Roach v. Junction Oil, etc., Co. (170 Rac. 034) (Okla.) J)3 

Robert v. Sadler (104 N. Y. 220, 10 N. E. 428, 58 Am. Rep. 408) 13 

Roberts v. Bettman (45 W. Va. 143, 30 S. E. 05, 10 M. R. 326) 115 

Rolrinson, In re (28 Tex. App. 511, 13 S. W. 786) 164 

In re (21 L. D. 116 ) 320 

v. Rispiri (33 Cal. App. 536, 165 Pac. 070) 132, 133, 134, 135 

v. Smalley (102 Kan. 842, 171 Pac. 1155) 40, 58 

Rochester Oil Co. v. Hughey (56 Pa, 322, 4 M. R. 282) 137 

Rock House Fork Land Co. v. Raleigh Brick, etc., Co. (07 S. E. 684) 

(W. Va.) 

Rolshouse v. Wally (263 Pa. 247, 106 Atl. 227) 140 

Rooney v. Barnette (200 Fed. 700, 110 C. C. A. 116) 237 

Root v. Townsend (215 S. W. 036) (Ky.) 56 

Rose v. Lanyon Zinc Co. (68 Kan. 126, 74 Pac. 625) 403 

Roseburg National Bank v. Camp (80 Ore. 67, 173 Pac. 313) 170 

Rowe v. Atlas Oil Co. (147 La. — , 84 So. 485) . 83, 87 

v. Brenton (8 B. & C. 737) 18 

Rumsey v. Sullivan (186 App. Div. (N. Y. ) 246, 150 N. Y. Supp. 287) 40 
Russell v. Lambert (14 Idaho 284, 04 Pac. 54, L.R.A.1015B, 20) .... 127 
v. Producers' Oil Co. (146 La. 481, 83 So. 773) 208, 213 

M. O. R.— 64. 



1010 TABLE OF CASES CITED 

PAGE 

Kymer v. South Penn Oil Co. (54 W. Va. 530, 46 S. E. 559) 102 

Rynd v. Rynd Farm Oil Co. (63 Pa. 397 ) 58 



St. Louis Co. v. Montana Mining Co. (171 U. S. 650. 43 L. ed. 320. 10 

Sup. Ct. Rep. 61, 17 M. R. 658) 240 

St. Louis Union Trust Co. v. Galloway Coal Co. (193 Fed. 106) 458 

Saltsburg Gas Co. v. Borough of Saltsburg (138 Pa. 250, 20 All. 844, 

10 L.R. A. 193 ) 188 

Sanders v. Austin ( 182 Pac. 449 ) ( Cal. ) • 174 

v. Rowe (48 S. W. 1083) (Ky. ) 104 

San Francisco Chemical Co. v. Duffield (201 Fed. 830) 300 

San Francisco Gas, etc., Co. v. San Francisco (164 Fed. 884) 195 

San Francisco Sav. Union v. R. G. R. Petroleum Co. (144 Cal. 134, 77 

Pac. 823, 66 L.R.A. 242, 103 Am. St. Rep. 72, 1 Ann. Cas. 182) 11 

Saxton v. Perry (47 Colo. 263, 107 Pac. 281 ) 236 

Sayers v. Kent (201 Pa. 38, 50 Atl.-296) 98 

Schmidt v. Union Oil Co. (27 Cal. App. 366, 149 Pac. 1014) 25, 173 

Schmidt-Blakely Coal Co. v. Hembree (134 Ark. 396, 205 S. W. Ill) . . 120 
Schobert v. Pittsburgh Coal, etc., Co. (254 111. 474, 98 N. E. 945, 40 

L.R.A.(N.S.) 826, Ann. Cas. 1913B, 1104) 458 

Scioto Oil Co. v. O'Hearn (169 Pac. 483) (Okla.) 217 

Scqit v. Lafayette Gas Co. (42 Ind. App. 614, 86 N. E. 495) .. 78 

v. Laws (215 S. W. 81) (Ky.) 8. 15, 19 

Seager v. McCabe (92 Mich. 186, 52 N. W. 299, 16 L.R.A. 247) 144 

Seward Dredging Co., In re (242 Fed. 225, 155 C. C. A. 65) 128, 179 

Seymour v. Fisher (16 Colo. 188, 27 Pac. 240) 156 

Shaffer v. Carter (40 Sup. Ct, Rep. 221 ) 160 

v. Howard ( 250 Fed. 873 ) 150 

v. Marks (241 Fed. 139) 58, 61, 64, 71, 75, 76, 121 

Shamway, In re (47 L. D. 71) 12 

Shellar v. Shivers (171 Pa. 569, 33 Atl. 95, 18 M. R. 260 i 02. 180 

Sherman Gas, etc., Co. v. Belden (103 Tex. 59, 123 S. W. 110, 27 

L.R.A.(N.S.) 237) 178 

Shertzer v. Myers (82 Kan. 275, 108 Pac. 105) 100, 180 

Shewalter v. Hamilton Oil Co. (28 Ind. App. 312. 62 X. E. 708) 27 

Shively v. Bowlby (152 U. S. 1, 38 L. ed. 331, 14 Sup. Ct. 548) 11 

silver v. Bush (213 Pa. 105, 62 Atl. 832 ) 8 

Silver King Coal Mines Co. v. Conkling Mining Co. (255 Fed. 740) . . 47 

Simin* v. Southern Pipe Line Co. (105 S. W. 283) (Tex. i 106, 203 

Simpson v. Pittsburgh Plate Glass Co. (28 Ind. App. 343. 02 X. P.. 753) 

16, 70, 197 
Skillman v. Lachnian (23 Cal. 198, 83 Am. Dec. 06, 103, 11 M. R. 381) 139 
Sledge v. Stolz (182 Pac. 340) (Cal.) 118 



I 



TABLE OF CASES CITED 1011 

PAGE 

Smith Case (143 Cal. 368, 77 Pac. 1W) 101 

— - v. Beebe (31 Idaho 469, 174 Pac. 608) 126, 127 

v. Cooley ( 65 Cal. 146, 2 Pac. 880) 205 

V. Guffey (202 Fed. 106, 120 C, C. A. 436 ) 61, 61 

v. Holloway ( 124 Jnd. 329, 24 N. E. 886) L3 

v. Jones (21 Utah 270, 60 Pac. 1104) 129, 205 

v. People's Natural Gas Co. (257 Pa. 396, 101 Atl. 739) .. 118, 

119, 122 

• v. Reynolds (8 Fed. 696, 3 McCrary 157, 2 M. R. 227) J 26 

■ v. Rome (19 Ga. 89, 63 Am. Dec. 298, 7 M. R. 306) 13 

v. Root. (66 W. Va. 663, 66 S. E. 1005, 30 L.R.A. (N.S.) 176) .. 

59, 110, 197 

v. Union Oil Co. ( 166 Cal. 217, 135 Pac. 966 ) 241 

v. United Crude Oil Co. (179 Cat 570, 178 Pac. 141) 107 

Snider v. Davidson ( 185 Pac. 724) (Kan. ) 139 

Snoddy v. Bolen (122 Mo. 479, 24 S. W. 142, 25 S. W. 932, 24 L.R.A. 

507) 13 

Snyder v. Philadelphia Co. (54 W. Va. 149, 46 S. E. 366, 63 L.R.A. 

896, 102 Am. St. Rep. 941, 1 Ann. Cas. 225) 174 

Sommers v. Bennet (68 W. Va. 157, 69 S. E. 690 ) 48 

Southern Pacific Railroad Co. v. Lane (263 Fed. 637) 253 

South Penn Oil Co. v. Latshaw (111 Fed. 598, 49 C, C. A. 478, 21 M. 

R. 600) 132 

v. Miller ( 175 Fed. 729, 99 C. C. A. 305) 195 

Southwestern Oil Co. v. Atlantic Co. (39 L. D. 335) 222, 228 

v. Texas (217 U. S. 114) 15!) 

Spence v. Lucas ( 138 La. 763, 70 So. 796 ) 56 

Sprague v. Locke (1 Colo. App. 171, 28 Pac. 142) 199 

Springfield Foundry, etc. Co. v. Cole (130 Mo. 1, 31 S. W. 922) 131 

Stahl v. Illinois Oil Co. (45 Ind. App. 211, 90 N. E. 632) .. . 63, 64, 

89, 94 

v. Van Vleck (53 Ohio 136, 41 N. E. 35, 18 M. R. 231) . . 54, 56, 83 

Stamey v. Hemple (173 Fed. 61, 97 C. C. A. 379) 127 

Standard Home Co. v. Davis (217 Fed. 904 ) 812 

Standard Oil Co. v. Barlow (141 La. 52, 74 So. 627) 180 

Standard Oil Co. v. Commonwealth (119 Ky. 75, 82 S. W. 1020) 158 

v. Fredericksburg ( 152 Va. 82, 52 S. E. 817 ) 158 

v. Graves (94 Wash. 291, 162 Pac. 558 ) 163 

v. (249 U. S. 389, 63 L. ed. 413, 39 Sup. Ct. Rep. 320) .. 163 

v. Howe (257 Fed. 481, 483 ) 160 

v. Police Jury (140 La. 42, 72 So. 802 ) 158 

v. Tierney (92 Ky. 307. 17 S. Vv. 1025, 14 L.R.A. 677. 36 Am. 

St. Rep. 595 > 172 

Starr v. Crenshaw (213 S. W. 811) (Mo.) 125, 129 

State v. Agey (171 N, C. 831) 817 



1012 TABLE OF CASKS CJTED 

PAGE 

v. Berry (52 N. J. L. 308, 19 All. 065 ) 166 

v. Capdeville (146 La. — , 83 So. 421) 12 

v. Dauben (324 X. E. 232 ) (Ohio i 161 

v. Flanneiiy (96 Kan. 372, 152 Pac. 22) 100 

v. Foster (189 Pac. 953 j (Kan. ) .'. 188 

v. Hayes ( 78 Mo. 307 j 25 

v. Indians, etc, Alining Co. (120 Ind. 575, 22 X. E. 778, 6 L.R.A. 

579 ) 169 

v. Savidge (188 Pac. 923) (Wash.) 22 

v. Moore (27 Ind. App. 83, 00 X. E. 955, 21 M. Pv. 401) ... 24, i99 

■ v. Oak Harbor Gas Co. (53 Ohio St. 347, 41 N. E. 584) 188 

v. Ohio Oil Co. (150 Ind. 21, 49 N*. E. 809, 47 L.R.A. 627) 187 

v. Prout ( 72 Xeb. 497 ) ' 810 

v. Standard Oil Co. (01 Ore. 438, 123 Pac. 40, Ann. Cas. 1914B, 

179 ) 157 

■ v. ; (100 Xeb. 820, 101 X. W. 537, L.R.A.1917D, 740) 158 

v. Stephens (130 Mo. 537 ) * 10 

State of California, In re (44 L. D. 127 ) 509 

■ v. Welch (184 Pac. 780, 787) (Okla.) 58 

State Line, etc., Railroad Co.'s Taxation, In re (107 Atl. 800) (Pa.) 157 
State Public Utilities Commission v. Springfield Gas & Electric Co. 

(125 X. E. 891) (111.) . . 162 

Steel v. American Oil Development Co. (80 W. Va. 200, 92 S. E. 410) 

39, 40 

Steelsmith v. Fisher Oil Co. (47 W. Va. 391, 35 S. E. 15) - 195 

Steelsmith v. Gartlan (45 W. Va. 27, 29 S. E. 978, 44 L.R.A. 107, 19 

M. R. 315) 00 

Steiner v. Marks (172 Pa, 400, 33 Atl. 095, 18 M. R. 320) 120, 121 

Stem v. Kemp ( 180 Pac. 940 ) (Okla. ) 100 

Stenfield v. Espe ( 171 Fed. 825, 90 C. C. A. 497 ) 230 

Stewart v. Tennant (52 W. Va. 559, 44 S. W. 223) 70<> 

Stine v. Producers' Oil Co. (203 S. W. 120) (Tex: ) 123 

Stone v. Marshall Oil Co. (188 Pa. 002, 41 Atl. 748, 1119, 19 M. R. 

593 ) 94, 104. 105, 107, 142, 147 

-v. (208 Pa. 85, 101 Am. St. Rep. 904, 05 L.R.A. 218) 207 

v. United States (107 U. S. 178, 42 L. ed. 127, 17 Sup. Ct. Rep. 

778 ) 189 

Stoughton's Appeal ( 88 Pa. St. 198 ) 9 

Strange v. Hicks (188 Pac. 347) (Okla.) 82, 110, 122 

Stroehle, In re (47 L. D. 72) 12 

Sullivent v. Clear Creek, etc., Oil Co. (211 S. W. 173) (Ark.) 95 

Suit v. A. Hochstetter Oil Co. (03 W. Va. 317, 01 S. E. 307) 194 

Summerville v. Apollo Gas Co. (207 Pa. 334, 50 Atl. 870) 92 

Superior Oil ,V- Gas Co. v. Mehlin (25 Okla. 809, 108 Pac. 545, 138 

Am. St. Rep. 942) 203 



TABLE OF CASES CITED 1013 

PAGE 

Swan v. OT.ar ( 107 Pac. 470) (Okla.) 103 

Synder v. Wilder (84 So. 104 ) (La. ) 20 4 

T 

Taconia Lime Co., In re (43 L. D. 128) £4o 

lalbott v. Southern Oil Co. (60 W. Va. 42.'), 55 S. E. 1'609) Is7 

Tallon v. Vindicator Consolidated (-old Mining Co. (5!) Colo. :;!(>, 149 

Pac. 108) 15S 

Taylor, ex parte (68 Fla. 61, 66 So. 292, Ann. Cas. 1916 A, 701) .... 813 

v. Thomas (31 Colo. 15, 71 Pac. 381) 142 

Terrell Co. v. Davis (188 Pac. 676) (Okla.) 212 

Test Oil Co. v. La Tourette (19 Okla. 214, 91 Pac. 1025) 36 

Texas v. Keeter (219 S. W. 521) ■ 151 

Texas & N. O. E. Co. v. Bellar (51 Tex. Civ. App. 154, 112 S. W. 323) 

25, 172 
Texas Co. v. Central Fuel Oil Co. (194 Fed. 1, ]14 C. C. A. 21) ... 189, 203 

v. Daugherty (107 Tex. 226, 176 S. VY. 717) 8. 156 

v. Dunn (219 S. W. 300) 126 

v. Fisk ( 1 2L» S. W. 188 ) (Tex. ) 161 

Texas Pacific Coal & Oil Co. v. Howard (212 8. W. 735) (Tex.) 194, 197 

Thomas Charles 8., In re ( 47 L. D. 43 ) 220 

v. Horst (54 Mont. 260, 16D Pac. 731 ) 251, 253 

Thomason v. Upshur County (211 8. W. 325) (Tex.) 15 

Thompson v. Noble (3 Pgh. 201, 11 M. R. 137) 9 

v. Underwood (211 S. W. 164) (Ark.) 193, 233 

v. Union Traction Co. (103 Kan. 104, 172 Pac. 990) 174 

Threlkeld v. Inglett (289 111. 90, 124 N, E. 368) 126, 128 

Tide Water Pipe Co. v. State Board (57 N. J. L. 516, 27 L.R.A. 684. 

31 Atl. 220) 160 

fierney, Lawrence E., Coal Co. v. Smith's Guardian (180 Ky. 815, 

203 S. W. 731) ' 49 

Tipping v. Bobbins (71 Wis. 507. 37 X. W. 427) 131 

Titusville Novelty Iron Works Appeal (77 Pa. 103 I 180 

Tonopah Min. v. Wesf End Cons. M. Co. (158 Pac. 881 ) 957 

Townsend v. State (147 Irid. 624. 47 N. E. 19, 37 L.R.A. 294. 62 Am. 

St. Pep. 477 ) 188 

! ruby v. Palmer ( 6 Atl. 74 ) ( Pa. ) 28 

Tucker v. Missouri Pacific Railroad Co. (82 Kan. 222, 108 L y ac. 89 ) . . 169 

Tupeker v. Deaner (46 Okla. 328, 148 Pac. Prrt j 58, 107 

Turben v. Douglas ( 183 Pac. 881 ) (Okla. ) 107 

Turner v. Seep ( 167 Fed. 646) 208 

Twin Hills Gasoline Co. v. Bradford Oil ( orporation (264 Fed. 440) 

26, 27 
T. W. Phillips G. & O. Co. v. Lingenfelter (262 Pa. 500, 105 Atl. 888) 16 



.101 -I TABLE OF CASES CITED 

PAGE 

Tyner v. People's Glas Co. (131 lnd. 408, :il X. E. 61) 185 

Tyson Creek Railroad Co. v. Empire Mill Co. (31 Idaho 580, 174 Pac. 

1004 ) 230 

u 

Uhl v. Ohio River R. Co. (34 S. E. 034, 47 W. Va. 5>) 107 

Ulrey v. Keith (237 111. 284, 86 N. E. 696 ) 108 

v. Poe ( 134 111. App. 208 ) , _. 60, 75 

Uncle Sam Oil Co. v. Richards (184 Pac. 575 ) (Okla.) 134 

v. (60 Okla. 63, 158 Pac. 1187) Ill 

Union Coal Co. v. La Salle (136 111. 110, 12 L.R.A. 326, 26 X. E. 506) 13 

Union Oil Co., In re ( 23 L. D. 222) 221 

r v. Smith (249 U. S. 337 ) 242 

Union Petroleum Co. v. Bliven Petroleum Co. (72 Pa. 173) 102 

Union Sulphur Co. v. Reed (249 Fed. 172 ) 158 

United Mining Co. v. Morton (174 Ky. 366, 192 8. W. 79) 141 

United States v. Apple (262 Fed. 200) . , 210 

v. Biwabik Mining Co. (247 U. S. 116, 62 L. ed. 1017, 38 Sup. 

Ct. 462) . 60. 150 

v. Brewer Elliott Oil & Gas Co. (249 Fed. 609 ) 12 

v. Brookshire Oil Co. (242 Fed. 718) 236. 237, 238 

v. California Midway Oil Co. (259 Fed. 343) 152, 155. 237 

v. Cornet Oil, etc., Co. (187 Fed. 674) 95 

■ v. Cook (22 L. ed. 210, 10 Wall. 501) 976 

v. Dominion Oil Co. (264 Fed. 055) 303 

v. Fisher (223 U. S. 683, 56 L. ed. 610, 32 Sup. Ct. Rep. 356) . . 251 

v. Grand Canyon Cattle Co. (247 Fed. 446, 159 C C. A. 500) . 155 

v. Grass Creek Oil Co. (236 Fed. 481, 149 C. C. A. 533) 257 

v. Gratiot (14 Pet. 526, 10 L. ed. 573 ) 2f$l 

v. Grimaud (220 U. S. 506, 55 L. ed. 563, 31 Sup. Ct. Rep. 480) 

252. r>j:; 

v. Hinkle (261 Fed. 518) 217 

v. Hitchcock (100 U. S. 316, 47 L. ed. 1074, 23 L. ed. 608) 251 

v. Honolulu Consolidated Oil Co. (249 Fed. 167) 194, 250 

'v. Iron Silver Co. (128 U. S. 673, 32 L. ed. 571, Sup. Ct. Rep. 

105 ) 24?» 

v. Lane (258 Fed. 520, 40 Sup. Ct. Rep. 33) 217, 221, 251 

v. Lavenson (206 Fed. 755) ; ' 512 

-v. Midway, etc., Oil Co. (232 Fed. 610) 200. 257 

v. Midwest Oil Co. (236 U. S. 450, 59 L. ed. 673, 35 Sup. Ct. Rep. 

309, 216 Fed. 802 ) 255 

v. Moore (261 Fed. 523 ) 217 

— - v. Mcfcutchen (234 Fed. 702) 250 

v. (238 Fed. 575 ) '. 227 



. TABLE OF CASES CITED 1015 

PAGE 

v. North American Oil Co. (242 Fed. 723 ) 257 

• v. Northern Pae. Ry. Co. (264 Fed. 898 ) 514 

v. Ohio Oil Co. (240 Fed. 996) 222, 228, 229, 300 

v. Poland (251 U. 8. 221, 64 L. ed. — , 40 Sup. Ct. Rep. 127, 163) 155 

v. Porter Fuel Co. ( 247 Fed. 769 ) 221 

■ v. Raine-Andrews Lumber Co. (262 Fed. 787) 151 

v. Record Oil Co. (242 Fed. 746) 250, 254, 258 

v . Ridgely (262 Fed. 675 ) 253 

v. Rock Oil Co. (257 Fed. 331 ) 233, 258 

-v. Safe Investment Oold Mining Co. (258 Fed. 872) 152, 230 

.v. Southern Pacific Railroad Co. (225 Fed. 197. 249 Ved. 785) .. 250 

v. ■ ( 260 Fed. 511 ) 250 

v. Standard Brewery (40 Sup. Ct. Rep. 139) 252 

■ v. Stockton Midway Co. (240 Fed. 1006) 228, 259 

..y. Sweet (245 U. S. 563, 62 L. ed. 473, 38 Sup. Ct. Rep. 193) . . 220 

-v. Thirty-Two Oil Co. (242 Fed. 730) 223, 258 

Utah v. Olson (47 L, D. 58) 221 



Vacuum Oil Co. v. Eagle Oil Co. (154 Fed. 867 ) 190 

Van Brocklin v. Tennessee (117 U. S. 158) 513 

Van Etten v. Kelly (66 Ohio St. 605, 64 N. E. 560, 22 M. R. 269) . . 75, 79 

Van Winkle v. Hinkle (180 Pac. 942) (Okla. ) 152 

Vedin v. United States (257 Fed. 550) 242 

Venture Oil Co. v. Fretts (152 Pa. 451, 25 Atl. 732, 17 M. R. 543) 

21, 79 
Virginia Coal & Iron Co. v. Kelly (93 Va. 332, 24 S. E. 1020, 18 M. R. 

395) 19 

Virginia Iron, etc., Co. v. Combs (216 S. W. 846) (Ky.) 16 

Vogel v. Warsing (146 Fed. 949, 77 C. C. A. 199) 230 

Von Baumbach v. Sargent Land Co. (242 U. S. 503, 61 L. ed. 460, 

37 Sup. Ct. 201 ) 60, 159 

Vore v. Ephraim (173 Cal. 245, 159 Pac. 719) 251 

w 

Wafford Oil Co. v. Smith (263 Fed. 396) 159 

Wagner v. Mallory (169 N. Y. 501, 62 N. E. 584. 22 M. R. 42) . . 22, 

59, 60 

Wah-Hrah-lum Pah v. To-wah-e-He (1*8 Pae. ifo'c i (Okla.) 218 

Wailes v. Daviea (158 Fed. 667) 874 

\\ allace v. Jefferson Gas Co. (147 Pa. 205, 23 Atl. 416) 166 

Walla Walla Oil, etc, Co. v. Vallentine (103 Wash. 359. 174 Pac. 980) 

58, 155 

Walton v. Wild Goose Co. (123 Fed. 209, 60 C. 0. A. 155, 22 Mi R. 688) 877 



1016 TAKLK OF C.VSKs | 1TKD - 

PAGE 

Warner v. Cochrane (128 Fed. 553, 03 C. C. A. 207) 08, 107 

v. Page (50 Okla. 250, J 50 Pac. 204) Z03 

Warren v. Boggs ( 07 S. E. 580 ) ( \V. Va. I 10 ! 

Warren Oil & Gas Co. v. Oilliam ( 182 Ky. 807, 207 S. W. 698) . . 78, 

07, 10S; 110 

Washburn v. Gillespie (201 Fed. 41) 04. So, 117, 108 

Washington Coal, etc., Co. v. Thurston County (177 Pac. 774) (Wash.) 151 
Washington Natural Gas Co. v. Johnson (123 Pa. 570, 10 Atl. 700, 

10 Am. St. Pep. 553, 10 M. R. 105) 00, 100 

Waskcy v. Hammer (170 Fed. 31, 05 C. C. A. 305) 238 

Waterman v. Banks (144 U. S\ 304, 30 L. ed. 470, 12 Sup. Ct. 040) . . 140 
Waters Pierce Oil Co. v. De Selms (212 U. S. 150, 53 L. ed. 453, 20 

Sup. Ct. Rep. 270) 172 

Watford Oil, etc., Co. v. Shipman (233 111. 0, 122 Am. St. Rep. 144, 

84 N. E. 53 ) 00, 103, 108, 203, 205 

Wear v. Kansas (245 U. S. 154) 13, 21 

Webb v. American Asphaltum Co. (157 Fed. 203, 84 C. C. A. 651) 

222, 300 

Weed v. Snook (144 Cal. 430, 77 Pac. 1023) 228, 220, 231 

Weiss v. Claborn (210 S. W. 884) (Tex.) 122 

Wemple v. Eastham (144 La. 057, 81 So. 438) 12 

v. Producers' Oil Co. (145 La, 103], 83 So. 232) 101 

Wentz's Appeal ( 100 Pa. 301 ) 144 

West v. Kansas Natural Gas Co. (221 U. S. 220, 55 L. ed. 716, 31 

Sup. Ct. Rep. 564, 35 L.R.A. (N.S.) 1103) 160 

Western Insurance Co. v. Skass (64 Colo. 342) 214 

Western Pennsylvania Gas Co. v. George (161 Pa, 47, 28 Atl. 1004) 

78, 02 

Westmoreland Coal Company's Appeal (85 Pa. 344) 144 

Westmoreland, etc., Natural Gas Co. v. De Witt (130 Pa. 235, 210, 18 

Atl. 724, 5 L.R.A. 731 ) 20, 40 

West Virginia Transportation Co. v. Volcanic Oil & Coal Co. (5 W. Va. 

382 ) '. 160 

v. Ohio River Pipe Line Co. (22 W. Va. 000, 40 Am. Rep. 527) . . 170 

Wettengel v. Gormley (100 Pa. 500, 28 Atl. 034, 18 M. R. 03, 40 Am. 

St. Rep. 733 ) ■ 101 

v . (i 84 p a< 3(54, 39 Atl. 1118) 101 

Wlialley v. Ramage (10 Wkly. Hep. 315. 8 VI. R. 52) 458 

Wheeling Creek Gas Co. v. Elder ( 170 V^\. 215) 050 

White v. Dennis (220 S. W. 101 ) (Tex. Civ.) .- 05, 00 

v. Green ( 103 Kan. 405. 173 Pac. 074 ) 58 

v. Kroeger ( 180 Pac. 477 ) (Okla. | 84 

v. Lee (78 Cal. 503, 21 Pac. 303, 12 Am. St. Rep. 115) 230 

Whittemore v. Baxter Laundry Co. (181 Mich. 564, 118 N. W. 437, 

52 L.i;.A.(N'.S.) !):;<), Ann. Gas. 1010C, 818) .... 24, 177 



TABLE OF CASES CITED 101 



PAGE 

Whiting v. Straup (17 Wyo. 1, 95 Pac. 849, 129 Am. St. Rep. 10)3) . . 232 

Wichita Natural Gas Co. v. Ralston (SI Kan. 8G, 105 Pac. 430) 197 

Wilcox v. Consolidated Gas Co. (212 U. S. 19, 53 L. od. 382, 29 Sup. 

Ct. Rep. 192, 15 Ann. Cas. 1034. 48 L.R.A. (N.S.) 1134) 1(51 

Wilhitc v. Skelton (5 Ind. Terr. 021, 82 S. W. 932) 1S9 

Willard v. Bank ( 18 Wall. 589 ) 327 

William R. Compton Co. v. Allen (216 Fed: 537 ) 814 

Williams v. Fowler (201 Pa. 336, 50 Atl. 969) 192 

v. Guffey (178 Pa. 342, 35 Atl. 875, 18 M. R. 478) 100 

■ v. Milton (215 Mass. 1 ) 914 

Williamson v. Jones (43 W. Va. 562, 27 S. E. 411, 38 L.R.A. 694, 64 

Am. St. Rep. 891, 19 M. R. 19) 45, 46, 197 

Wilmore Coal Co. v. Brown (147 Fed. 931, 943) 110 

Wilson v. Goldstein ( 152 Pa. 524, 25 Atl. 493 ) 123 

Winemiller v. Page ( 183 Pac. 501 ) (Okla. ) 143 

Winfall Manufacturing Co. v. Patterson (148 Ind. 414, 47 N. E. 2, 

37 L.R.A. 381, 62 Am. St. Rep. 532, 18 M. R. 674) 176 

Winkler v. Anderson ( 104 Kan. 1, 177 Pac. 521 ) . -. 177 

Winters v. U. S. ( 143 Fed. 748, 178 ) 976 

Withington v. Gypsy Oil Co. (172 Pac. 634) (Okla.) 63 

Withroder v. Elmore (187 Pac. 863) (Kan.) 156 

Waldson v. Richmond M., etc., Co. (102 Wash. 248, 172 Pac. 1162) . . . 129 

Wolf v. Blackwell Oil & Gas Co. ( 186 Pac. 484) (Okla. ) 31 

Wood v. North Western Insurance Co. (46 N. Y. 421) 25 

Wood County Petroleum Co. v. West Virginia Transportation Co. (2o 

W. Va, 210, 57 Am. Rep. 659 ) 30 

Woodland Oil Co. v. Crawford (55 Ohio 161, 44 N. E. 1093, 34 L.R.A. 

62) 96, 115 

Wood Placer Mining Co., In re (32 L. D. 363, 401) 235 

Woods v. Chalmers Motor Co. (175 N. W. 449) (Mich.) v . . 172 

Woodward v. Mitchell (140 Ind. 406, 39 N. E. 437, 18 M. R. 158) . . 84, 85 

Woolfskill v. Smith (5 Colo. App. 175, 89 Pac. 1001) 225 

Worthen v. Sidway ( 72. Ark. 215, 79 S. W. 777) 236 

Wright v. Gillespie (261 Fed. 46) 63, 98, 196 

X 

Xenia Real Estate Co. v. Maey (147 Ind. 568, 47 N. E. 147) .. 197 

Y 

Yard, In re (38 L. D. 59) 243 

Young v. Forest Oil Co, (194 Pa. 243, 45 Atl. 121, 20 M. R. 345) . . 90, 91 



101S TAP-LK OF CASKS cm.l> 

z 

PAGE 

Zeigler v. Broimeman (237 111. 15, 80 N. E. 597 ) 47. 48, 205 

v. Hopkins (258 Fed. 4G7 ) 74 

Zerres v. Vanina ( 134 Fed. 610 ) 874 

Zimmerman v. Funcliion ( 161 Fed. 859, 89 C. C. A. 53 J 238 

Zinc Co. v. La Salle (117 111. 41], 2 N. E. 406, 8 N. E. 81) 13 

Zundelowitz v. Waggoner (211 S. W. 598) (Tex. ) 152 



INDEX. 

(References are to pages.) 

A 



ABANDONED GROUND pack 

Location of placer on 243 

ABANDONMENT 

Of lease 110, 240 

Testifying to intent of Ill 

"When re-entry not allowed Ill 

facts amounting to Ill 

Waiver of notice of 112 

Of right of way by pipe line 107 

Of placer claim 230. 210 

ACCOUNTING 

Between co-tenants 48 

ACKNOWLEDGMENT 

To leases 50 1 

ACREAGE 

Of coal land leases 263 

Limit of additional ; 26T> 

On account of coal exhausted 26. r > 

Of phosphate lease 208 

Of luase in land withdrawn under proclamation 27-> 

Limit of, in oil shale leases 280 

Of phosphate lands .'>7* 

In sodium leases 400 

Of coal prospecting permit . 470 

Limit of, for coal 421 

For phosphates 42 1 

For coal to municipal corporations 421 

For oil and gas permit on undeveloped territory 421 

For oil and gas leases 421 

On known-geological structure 421 

1019 



J 020 INDEX 

ACRE AG E — continued. page 

On proclamation claims 421 

On proclamation suits compromised 421 

Severed laud 421 

Of sodium 421 

Of oil shale 421 

Of oil and gas lands in Alaska 422 

ACTION 

Right of under lease f>9 

For delay rentals 94 

For rents and royalties 95 

History of, in ejectment _ 191 

When lies in ejectment 192 

ACT OF COURT 

Lessee not liable in damages for . . . . . 211 

ADMINISTRATOR 

Annual labor by 241 

ADVERSE CLAIMS 

Under sees. 18, 19 or 22, Oil Act ' 362 

Under the Pickett Act : 434 

Arbitration of 434 

In application for patent 894 

ADVERSE CLAIM SUITS 

In actions of ejectment 193 

ADVERSE POSSESSION 

Between owners of surface and minerals 18 

ADVERTISEMENTS 

Required by the Oil Act 264, 421 

AFFIDAVIT 

Of bidder for oil lease 324 

To location of placers in Idaho 870 

In application for patent 89] 

AGE-NT 

Posting notice by, Land Oflice construction 372 



IXDEX 102 1 

AGRICULTURAL ENTRIES pack 

Permit on. Land Office construction 370 

Conflicts with, Land Office construction 373 

Protected in withdrawal legislation 5J-! 

ALABAMA STATUTES 

Blue Sky Laws 81*1 

ALASKA 

Excepted from leases by competition 203 

Permits and preference rights in 27- 

Section 22 of Oil Leasing Act 282 

Oil and gas lands in 282 

Oil and gas permits in, L. O. Reg ' 337 

Permits in, Land Office construction 373 

Application of Oil Act to 410 

ALASKA CLAIMS 

Relief under section 22 354 

ALASKA COAL LANDS 

Excepted from Leasing Act of 1920 822 

Leasing Act of 1914 822 

Survey of territory directed 822 

President to reserve 823 

Coal lands to be blocked 823 

Sale by lease to qualified bidders 823 

New leases 824 

Consolidation of leases 825 

Maximum acreage 82f> 

Second lease forbidden 825 

Forf eiture 825 

Second lease, felony to hold S20 

Corporate officers attempting to hold 820 

Unlawful trust combination f . . . . . 820 

Rents and royalties 827 

Renewals 827 

Fi-pc coal on small tracts 827 

Easements, reserve of surface 828 

Lease to express certain terms 82U 

Possession of lessee, that of U. S -. 829 

Forfeiture by decree 829 

Statements to be verified, forms, blanks 830 

Regulations by Secretary of interim 830 

Presidential reserves 830 

Matanuska iield .- 83u 



1022 INDEX 

ALASKA COAL LANI>&-^continued. 

Presidential reserves — continued. PAOfi 

Bering River field S81 

Nenana Held 831 

General regulations 831 

Qualifications of lessee *>:)•> 

Right to prospect $34 

Use of timber 835 

Coal mining lease, form of §35 

Rights reserved by lessor SMti 

Lease subject to Leasing Act s:;; 

Mining rights limited , . 837 

Investment s:;7 

Annual rental 838 

Royalty 838 

Lessee to keep record of coal shipped 839 

Report to be furnished monthly 839 

Periods for readjustment of royalty 839 

Operations energetically prosecuted 840 

Workings not to be abandoned until 840 

Preliminary plan of mining submitted S40 

Two or more beds of coal, how worked 840 

50 ft. barrier pillars S41 

Room and pillar system 841 

Percentage of area, definition of 842 

Fires in mine prohibited 848 

Discovery of other minerals to be reported 848 

Map to be kept at mine office 84,'> 

What required to be shown on map 844 

Requirements for surface map v. '. H44 

General Property map, requirements for 845 

Map to be furnished lessor 845 

Abandoned areas surveyed and mapped 845 

Maps made at lessee's expense '. . . . 846 

Second exit to surface provided 840 

Limit of men employed in new workings 84H 

No buildings of inflammable material S47 

Main intake and return airways S47 

Pillars to be left standing 847 

Ventilating fan and control of 848 

Furnace used for ventilation, when 848 

Slack and refuse to be disposed of 84S 

Abandoned workings to be protected 849 

Operations subject to inspection 849 

Examinations of books to be permitted 840 

Lessees workings used by lessor '. 850 



index 102:> 

ALASKA COAL LA NTDS— con I in ued. 

Coal mining lease, form of — continued. vaui. 

Lessee keep weights and measurements 850 

Wages to be paid in lawful money 85,1 

Freedom of purchase, allowed 85] 

Eight-hour day required 851 

Surrender of premises 851 

Suspension of operations, forfeiture 852 

Lease not to be assigned 852 

Breach of covenants waived when 852 

Right to terminate lease 853 

Lessor may purchase equipment 853 

Lessee may remove equipment, when 853 

Forfeiture of lease 854 

Questions submitted to arbitration 854 

Manner of appointing arbitrator 854 

Appointment of new arbitrators, when 855 

Definition of terms used in lease 850 

Application for coal mining lease 858 

Coal mining permit 859 

Qualifications of applicants 859 

Who may mine coal for sale 800 

Duration of permits 860 

Limitation of area 860 

Scope of permit 86C 

How to proceed to obtain permit 86] 

Mining coal before permit issues 861 

Action by register 861 

Form of application for permit 862 

Modification of regulations for Nenana field 864 

ALASKA STATUTES 

License tax imposed on minerals 553 

Income defined, deductions 553 

Placer locations , 866 

Location notice 800 

Staking 867 

Blazing line stakes 867 

Location certificate, record 867 

ALTERNATIVE DECREE 

In forfeiture 123 

AMEXDED LEASE 

Of coal lands 45 j 



1024 INDEX 

AMENDMENT page 

Of location certificate 242 

ANALYSIS OF OIL AND GAS ACT 

Minerals covered by Act 2!M 

<• 

ANNUAL LABOR 

On placer claims . . . 239, 240 

By co-owner disputing title 240 

Test of value 241 

On group claims 241 

By administrator .... 241 

Resumption of work protects 241 

Oil claims distinguished as to 242 

Perjury in affidavit of 242 

APPALACHIAN FOREST ACT 

Mentioned in Leasing Act 510 

APPLICATION FOR PATENT 

$500 improvements 215 

Roads and trails 245 

Dredge or derrick 245 

Land office entry 240 

Attack after entry 246 

On surveyed land 878 

Forms in 878-807 

APPRAISAL 

Of price of coal land 220 

ARIZONA STATUTES 

Blue Sky Laws 812 

Location of placer claims 868 

ARKANSAS STATUTES 

Blue Sky Laws S 1 2 

ARTICLES OF INCORPORATION 

Forms of 906 

ASSESSMENTS 

Against, partners 141 

ASSESSMENT WORK 

On placci- claims ' 240 



INDEX 1025 

ASSIGNMENT page 

Of lease 106 

Incidents of 107 

Of sublease 1U7 

Of lease, when must be in writing 149 

Of lease forbidden 289 

Of permits, Land Office construction 37u 

Of phosphate lease 38b 

Under Oil and Gas Act * 429 

Of lease, form of 955 

Of option 950 

Of federal lease not permitted 950 

ASSIGNS 

Protected when lessee surrenders 81 

ASSOCIATION CLAIMS 

See Location of Placer Claims 230 

ATOMIC WEIGHT 

Of the elements, see Glossary 964 

AUCTION 

Of oil and gas leases, L. O. Reg 340 

AUCTION AND BONUS 

On petition for oil lease 324 

AUTOMOBILE 

Keeping gasoline in, insurance 215 



B 



BAKU OIL REGION 
Oil wells in 



BAUME SCALE 

When use required 5 

BENEFICIARY 

In leases and permits 356 

BERING RIVER FIELD 

Land reserved in 831 

General regulations concerning ....-- 831 

M. O. R.— 65. 



1026 INDEX 

BIDS page 

In letting leases . .. . : 439 

BLANKET CLAIMS 

See Location of Oil Placer Claims 236 

BLANKS 

Unfilled, in lease 55 

BLUE SKY LAWS 

Alabama 812 

Arizona S12 

Arkansas • • • • ......... 812 

California 813 

Colorado 813 

Connecticut 813 

Delaware 813 

Florida .' 813 

Georgia 813 

Idaho 814 

Illinois 814 

Indiana , 814 

Iowa 814 

Kansas 814 

Kentucky . 814 

Louisiana 815 

Maine 815 

Maryland T . 815 

Massachusetts '. 815 

Michigan ;...... 815 

Minnesota S15 

Mississippi 816 

Missouri 816 

Montana 816 

Nebraska . 816 

New Hampshire _,.......-.. 816 

New Jersey 816 

New York • 817 

North Carolina 817 

North Dakota 817 

Ohio 817 

Oregon 818 

Pennsylvania ''. 818 

Rhode Island 818 

South Carolina 819 

South Dakota 819 

■ 

Tennessee 819 



INDEX .1027 

BLUE SKY LAWS— continued. page 

Texas . . 819 

Utah . . . . . '.'.'. 819 

Vermont 820 

Virginia 820 

West Virginia . . 820 

Wisconsin , 820 

Wyoming 820 

BOND OF PERMITTEE AND LESSEE 

Form of 300 

See Land Office Regulations 330 

BONUS 

As consideration for lease 71 

Sufficiency of, question of fact 71 

For lands within known-geologic structure 274 

To be paid by bidder for oil lease 324 

BOOKS AND RECORDS 

Under phosphate lease 387 

BORAX 

See Sodium and Borax 283 

BORROWING .MONEY 

By partner 140 

BUILDINGS 

Protection of, from wells 39 

BURDEN OF PROOF 

On forfeiture of lease 113 

In cases of fraud 151 

BUSINESS TRUSTS 

Forms of .......911, 938 

BY-PRODUCTS 

Royalty on 101 

c 

CALIFORNIA STATUTES 

Oil and Gas Statutes 554 

Department of petroleum and gas created 555 



1028 INDEX 

CALIFORNIA STATUTES— continued. 

Oil and Gas Statutes — continued. page 

Supervisors 555 

Salaries, assistants 555 

Duties of supervisors enumerated 556 

Duties of deputies ; attorney 556 

Qualification of deputies — office kept open 556 

Deputies to collect information 557 

Records open to inspection 557 

Protection against water 558 

Appeal from supervisor's order 555) 

Division of state into districts 559 

Commissioners, how elected 560 

Meetings of commissioners 562 

Employment of attorney 562 

Expenses 562 

Stenographer , 562 

Certificate of expenses 563 

Annual elections 563 

Recall 563 

Vacancies 565 

Officer interested 565 

Supervisor's duties 565 

Practice on complaints 565 

Conduct of investigations 566 

Written decisions — review by certiorari 567 

Practice on review 568 

Enforcing repairs 568 

Regulation of casing 569 

Protection against water •. . , 569 

Regulation of abandonment of well 570 

Notice of intention to commence drilling 570 

Items of log of well 571 

Prospect wells 571 

Shut-off well regulated 572 

Monthly reports of production 573 

Penalties for violations 573 

Public interest and police power 573 

Collections for use of the Department : 574 

Tax on barrels produced 574 

Gas to pay on cubic feet 574 

Assessment of charges against land 574 

Additional charges 575 

Annual estimate of expenses 575 

Form of reports by owners 575 

Annual reports from operators 576 



INDEX 1029 

CALIFORNIA STATUTES— -contin ued. 

Oil and Gas Statutes — continued. page 

Procedure on failure to report 576 

Penalty for false report 576 

Extension of time to report 577 

Rate of assessment 577 

Annual assessment 577 

Clerical errors in 577 

Board of equalization 578 

Publication of assessment notice 578 

Correction of records 578 

Public record of assessment 579 

Certificate for State mineralogists 579 

Charges, when due 580 

Public notice of date to pay dues 580 

1 Assessments made a lien 581 

Payments made to State Treasurer 581 

Contest of charges 582 

Collection of delinquent charges 583 

Assessment periods 584 

Petroleum and gas fund 584 

Moneys credited to 585 

Annual production and finance report 585 

Lease report to supervisor 585 

Supervisor and other terms defined 585 

$20,000 appropriation 580 

Constitutional clause 587 

Liberal construction 587 

Repeal of prior act-,— -mining bureau 587 

Waste Act 587 

Waste of gas prohibited 588 

Gas well to be plugged 588 

Penalty for violation 588 

Enlarging crime by definition 588 

Blue Sky Laws 813 

Location of placer claims 868 

CAMP SITES 

With sodium permits 307 

CASING 

When a fixture , . 180 

Removal of, measure of damages 212 

CHAIN OF TITLE 

Breaks in, cured by patent 248 

Trusts in 248 



1030 INDEX 

CHATTEL REAL page 

Option is 129 

CITIES AND TOWNS 

Right to minerals under 13 

CITIZENSHIP 

Proof of 418 

Of corporations 418 

Aliens may not secure leases 418 

CITY ORDINANCE 

See Police Power 161 

CIVIL LAW 

Construction of oil lease, under '. . 64 

COAL 

Prospecting permits 264 

When exhausted additional lease 265 

No royalty on, for private use ♦. 267 

Location before passage of Oil Act protected 293 

Analysis of royalty on 425 

Prospecting permits for 476 

Included in Withdrawal Legislation 503 

COAL LAND 

Appraisal of price 220 

Knowledge of coal value 221 

Sections 2-8 of Oil Leasing Act 263 

Leasing by competition 263 

Alaska excepted 263 

Coal prospecting permits 264 

Advertising required 264 

Leases to railroads 264 

Additional acreage 265 

Coal exhausted 265 

Consolidation of leases , 265 

Uniting coal or phosphate leases 266 

Royalty 266 

Minimum tonnage 266 

Strikes 266 

Suspension of work 266 

No royalty on coal for private use 267 

Leases to cities 267 



index 10: jl 

COAL, LAND OFFICE REGULATIONS vagv. 

Petition for lease 45-, 

Prior equities of petitioner 45fi 

Opening coal land to bids 457 

Draft of lease 457 

Amended lease 457 

Construction of lease 458 

Instroke 458 

Permits to prospect : 458 

Free leases , 459 

The regulations 400 

Method of disposition 400 

Land to which applicable 400 

Who may take leases 400 

Equitable rights 4G0 

Repealing and saving clause 401 

Fees and commissions 401 

Leasing units 402 

Minimum development 402 

Petition for leasing units 403 

Action by local office 404 

Action on petition 404 

Notice of offer 404 

Auction of lease 405 

Right to reject bids 465 

Action by bidder 465 

Action by district officers 466 

Modification of leases 466 

Form of lease 466 

Coal prospecting permits 476 

Character of land 476 

Area 476 

Rights conferred 476 

Application for permit 477 

Form of permit 477 

Leases to permittees 479 

Limited license to mine 479 

Area and duration 480 

Application for license 480 

Form of application for license 480 

Petition for coal permit 484 

COAL LEASES 

Consolidation of 205 



1032 INDEX 

COAL WEIGHING page 

Leases shall provide manner of 424 

COLOEADO STATUTES 
Oil and Gas Acts 

Bore hole through coal 589 

Notice to State inspector 589 

Waste of gas or oil 589 

Duty to plug abandoned well 580 

Sworn report of plugged well 590 

Bore hole near coal mine 591 

Casing to shut off water 591 

Protection of coal seam 59] 

Exclusion of water 592 

Log of well 592 

Notification of abandonment 592 

Certain sections limited 592 

Annual report of inspector 592 

Power to remove inspector 592 

Official duty to enforce act 593 

Appointment of State inspector 593 

Oath of 593 

Bond of 593 

Deputies, analysis of samples 594 

Pipe line corporations 594 

Statements required in certificate 594 

Bight of way 595 

File map of course 595 

Furnish power 595 

Blue Sky Laws 813 

Location of placer claims 869 

COLLUSION 

Between lessors . 38 

COMBINATIONS , 

Of oil interests when permitted 437 

COMMON CARRIERS 

Pipe lines are ] 05. 905 

Not bound to furnish tank cars 170 

COMPLETED WELL 

Meaning of term 134 



index 1033 

COMPROMISE page 

Under sec. 18 A, Oil Act 363 

CONCEALMENT 

Of oil strike, when fraud ]52 

CONDEMNATION 

By pipe lines 106 

CONFLICTING PREFERENCE RIGHTS 

Land Office, construction of 370 

CONGRESSIONAL LEGISLATION 

Concerning oil placers .- 224 

CONNECTICUT STATUTES 

Blue Sky Laws - 813 

CONSIDERATION 

One dollar, in leases 67 

Inadequate, in leases 69 

Promise, where not 69 

Protection, covenant as 70 

Bonus on lease, as 71 

For option 125 

Inadequacy of, in contract with Indian . '. 153 

Action for specific performance must allege 202 

CONSOLIDATION 

Of coal leases 205, 429 

Of coal or phosphate leases 206, 429 

CONSPIRACY 

Ground for forfeiture of lease 286 

CONSTRUCTION 

Of lease 62, 458 

Of implied covenants 62 

Written insertions control printed form 62 

Lessor, favored in 62 

General rules of 63 

Of parties to 63 

Federal Courts follow local law 64 

CONTRACT 

By cotenant, when personal 48 



1034 INDEX 

CONTRACT— continued. page 

Construed as lease 56 

To sink .132 

Fishing for tools, part of 132 

Interference with contractor 133 

To sink to paying quantities 133 

To oil sand 3 33 

To deliver good cleanhole 134 

For completed well 131 

Measure of damages for work in sinking 135 

For profits to be earned 135 

Casing and equipment not included 135 

To sink includes barren ground 13G 

Evidence as to 136 

Tying up right to drill 136 

Price payable out of mine 136 

For sales of oil 137 

For delivery of oil : 137 

For repair of tanks 137 

For sales of gas 138 

Excess gas - 138 

Between gas well and pipe line 138 

To form corporation, when not specifically performed 204 

Form of drilling ■. 944, 950 

CONTRACTOR 

Interference with, sinking v . 133 

CONTROVERTED CLAIMS 

Under the Pickett Act 434 

Arbitration of 434 

CONVEYANCE 

Of mineral rights 15 

Severance, exception, and reservation in . . .• 15 

Description in 16 

Deed and lease combined 17 

CO-OWNER 

Annual labor by, disputing title 240 

CORNERS 

Of land described in permit to be staked 271 

CORPORATE EMPLOYEES 

Location of placer claim by , > 237 



INDEX 1035 

CORPORATE HOLDINGS page 

Limitations on, under Leasing Act 285 

CORPORATION 

No specilic performance of contract to form 204 

Number of permits held by, Land Office construction 372 

Citizenship of 418 

Limited as to number of leases 43G 

Application by, for prospecting permit 484 

Application for patent by 893 

COSTS 

Party not benefited not pay receiver's 200 

CO-TENANTS 

Lease by 46 

Accounting between 46 

Liability of lessee to 48 

Waiver of tort by 48 

Contract by, when personal 48 

License by one 131 

COVENANT 

Implied for protection wells 34 

Implied, in leases 62 

For sinking 82 

Diligence in 84 

Reasonable time for 83 

Default on time in 83 

Commencing 84 

Excuse for delay in 85 

Runs with the land •:..... 85 

Danger of drainage by failure to 86 

Waiver of, to sink 86 

For royalty runs with land 94 

Implied, no forfeiture for breach of 118 

Miscellaneous, in Oil Act leases 290 

CUTTING OFF GAS 

Injunction against 190 

D 

DA MACE 

To fresh Mater by salt water well 29 

For waste not Maived by injunction 199 

When too remote 211 

See Measure of Damages 207 



1036 INDEX 

DEFAULT page 

For failure to sink . • 83 

DELAWARE STATUTES 

Blue Sky Laws 813 

DELAY 

To sink, least favored for forfeiture 116 

DELAY RENTALS 

When sufficient consideration 94 

DEMAND 

To sink protection well : 37 

For forfeiture, when necessary v 118 

DEMISING CLAUSE 

In lease 55 

DEPRECATORY CLAUSES IN OIL ACT 

Corporations limited as to number of leases 436 

Fraud 437 

Trusts « 437 

Combinations 437 

DERRICK 

As improvements in patent application 245 

DESCRIPTION 

Of oil land in conveyance 16 

In Oil lease 56 

DILIGENCE 

In sinking 82, 84 

DISCOVERY 

Of oil, incidents peculiar to 225 

Decisions on 227 

Seepage is not 228 

Of shale or sand, when no 228 

On group claims 228 

Staking and record before 220 

Proof of 220 

Instances of / 230 

Possession before 231 

Of mineral after patent , 248 



i 



INDEX 1037 

I&$COVERY— continued. page 

Oil and gas claims having no discovery on Oct. 1, 1919 278 

Claims having discovery entitled to lease 279 

Royalty in such leases 279 

Naval reserves excepted 278 

Right to perfect after passage of Oil Act 293 

Land Office, construction of, sec. 37 305 

Reward for, under oil and gas permit, L. 0. Reg 336 

Claims without, relief clauses 432 

DISCOVERY WORK 

On placer claims, statutory requirements 866-877 

DRAFT OF LEASE 

For coal lands 457 

DRAINAGE 

Covenant for, in lease 61 

Injunction against 197 

DREDGE 

As improvement in patent application 245 

DRILLING 

Injunction against 196 

Time to commence, under Oil and Gas Act 270 

DRILLING CONTRACTS 

Measure of damages for breach of 212 

Under permits, Land Office construction 372 

Forms of . . . 944, 950 

DRILLING OIL WELL 

Whether mining 9 

DUMMIES 

In location of placer claim 237 

E 

EASEMENTS 

Leases and permits subject to 288 

Pipe line right of way 899 

Crossing forest reserve 900 

Maps of line 901 

Form of petition for 901 



1038 INDEX 

ELEMENTS— continued. page 

Pipe line right of way — continued. 

Shall carry for government and others 903 

Combinations of lessees for 904 

Regulation of, by Secretary 904 

Requisition of, by President 904 

Revenue taxes on 904 

Is common carrier , 905 

EIGHT-HOUR DAY 

In Oil Act leases . .\ 289.. 424 

See Land Office Regulations. 

EJECTMENT 

History of action 191 

Right to jury trial 191 

Where the action lies 192 

No jurisdiction in equity ^ . . . 192 

Where action does not lie * 193 

Undesignated drill sites 193 

Adverse claim suits 193 

Set off 193 

ELEMENTS 

Table of, see Glossary 964 

ENTRY 

Attack on patent after 240 

EQUITY 

Relief in, against forfeiture 121 

When denied 122 

No jurisdiction in ejectment 192 

EVICTION 

Conveyance by lessor is, when 109 

Excuse for nonpayment purchase money 204 

EVIDENCE 

Expert, as to protection wells 3D 

Of fraud 151 

Rule of, in negligence by fire 175 

EXCEPTION 

Of minerals in conveyance 1ft 

In U. S. patents , 1 9 

To rule of forfeiture 115 



INDEX 1039 

EXCESS LOCATIONS . PAGE 

Of placer claims 238 

EXCLUSIONS 

In location of placers . 236 

In Oil Leasing Act 262 

In Oil Act 419 

EXECUTOR 

Lease by 50 

EXTENSION 

Of time to sink well 270 

Of permit on nonproven oil ground 318 

Of oil and gas permit, L. 0. Reg .336 

F 

FEDERAL REQUIREMENTS 

For oil placer locations . 225 

FEES AND COMMISSIONS 

To Land Oilices 293, 364 

FERAE NATURAE 

Doctrine of, applied to oil and gas 20 

FIXTURES 

What are removable . . . . 179 

Time to remove 180 

Casing 180 

When real estate 180 

Contest between lessees 181 

Injunction should not prevent removal 199 

FLAMBEAUX LIGHTS 

Waste of gas by, forbidden 188 

See Statutes of the States 553 

FLOATING OIL 

Negligence to allow 172 

FLORIDA STATUTES 

Blue Sky Laws 813 



1040 INDEX 

FLUIDS PAGE 

Associated with oil 4 

Oil is a fluid, like water 22 

FOREST RESERVES 

See Withdrawal Legislation 502 

Creation of new, prohibited 504 

Appalachian Forest Act 510 

National forests 511 

Administration 511 

Mining claims in 5.12 

Evidence of mineral value of 512 

Power of department to regulate . . 513 

FORFEITURE 

Of lease 113 

Burden of proof 113 

When not enforceable 113 

Clause for benefit of lessor ■ 115 

Exception to rule of 115 

When automatic 116 

Delay to sink, perform or pay 116 

Least favored 116 

Not allowed for breach of implied covenant 118 

Acceptance of rent, waiver of 118 

Demand for, when necessary 118 

Express provision for 110 

Not allowed where relief at law Ill) 

Absence of a market, excuse against 120 

Waiver of, by laches 120 

Estoppel against 120 

Relief in equity 121 

When denied 1 22 

Practice in 122 

Choice of remedies 12^ 

Alternative decree 12:> 

Special instances of 123 

Of oil and gas lease enforced by Court 274 

Of lease may be ordered by Court 280 

Of lease for trust or conspiracy 280 

Of phosphate lease . . . 388 

Cause for, under Oil Act 42. > 

Of oil shale lease 451 



INDEX 1041 

FORMS page 

Alaska Coal Lease 835 

Application for lease 8.38 

Application for mining permit 802 

Articles of incorporation of oil company 90o 

Of oil shale company 909 

Of pipe line company 910 

Coal petition for lease 455 

Lease 46ft 

Prospecting permit 478 

Application for license to mine 481 

Petition for permit 484 

Drilling contract, standard form 945 

Rotary form 950 

Lease 488 

Assignment of 955 

Oil and Gas, on nonproven ground — 

Notice of intended application for permit 308 

Application for permit 312 

Bond of permittee 314 

Notice that permit has been granted 316 

Permit 334 

Petition for extension of permit 318 

Application for lease 321 

Oil and gas, on known-geological structure — '■ 

Affidavit of bidder 324 

Lease 341 

Published notice of application for lease oftl 

Oil and gas leases — 

Oklahoma form 488 

Wyoming form 493 

Acknowledgment to 490 

Mining rights form 497 

Oil shale petition for lease 441 

Notice of application for lease 446 

Lease 447 

Phosphate lease 381 

Use permit , 391 

Application for 393 

Pipe line petition for right of way . . . . 901 

Placer location certificate 243 

Notice of application for patent 878 

Proof of posting notice on claims 879 

Application for patent 880 

Corroborating affidavit 883 

Proof of citizenship 88 1 

M. O. R.— 66. 



1042 INDEX 

FORMS — continued. page 

Placer location certificate — continued. 

Publisher's contract 88.1 

Proof of no known vein 880 

Proof that notice remained posted on claim 888 

Certificate of publication : 880 

Proof of sums paid 889 

Application to purchase 890 

Power of attorney to apply for patent 892 

Corporate resolution 893 

Power of attorney to apply for patent 892 

Adverse claim 895 

Sodium prospecting permit 398 

Notice of application for lease 404 

Lease 405 

Use permit for camp site 413 

Application for permit 415 

Trust agreements ... 915, 938 

FRAUD 

The pleading ; . . 151 

Information from spirits 151 

Evidence of 151 

Burden of proof 151 

Knowledge of facts 152 

Opinions as to value 152 

Concealment of strike 152 

Corporation cases 152 

Contract, with Indian convict 153 

Sale by sample 153 

Inadequacy of consideration 153 

Promise to be performed 153 

Suit by stockholders to set aside sale . 153 

No relation back 154 

Bona fide purchaser 154 

Election of remedies 154 

Waiver of 154 

In obtaining patent 249 

Vitiates leases, under Oil Act 437 

FREEHOLD 

Character of lease 58 

FREE LEASES 

Of coal lands . , 459 



index 104H 

FUGACIOUS CHARACTER page 

Of oil and gas 20 

Analogy between 21 

Must be reduced to possession 22 

Of oil, partition denied because of 205 

FUSING POINT 

Of the elements, see Glossary . 964 

G 

GAME AND FISH 

Analogy between, and oil and gas 21 

GAS 

Judicial notice, cannot be stored 24 

Of inflammable traits 24 

Is highly explosive 25 

That coal mines generate 25 

Used on premises . 30 

Distinction between, and oil 30 

Contracts, for sale of 138 

Of excess 138 

Locations before passage of Oil Act protected 293 

Not specifically provided for in Act 417 

Waste of, prohibited 423 

Included in Withdrawal Legislation 503 

Definition of, see Glossary 967 

GASOLINE 

Storage of, when negligence 172 

Keeping in automobile 215 

GASOLINE STATION 

When a nuisance 177 

GAS RATES 

Fixed by ordinance 161 

GAS RENT 

For marketable quantity 27 

For gas from oil well 28 

GAS WELL 

Distinction between, and oil wells 29 

Gas found when oil contracted for 28 



1044 INDEX 

GAS WORKS PAGE 

When a nuisance 178 

GEORGIA STATUTES 

Blue Sky Laws 813 

GLOSSARY OF OIL TERMS 957 

GOOD CLEANHOLE 

Contract to deliver 134 

GROUP CLAIMS 

Annual labor on , . 241 

H 

HAZARDOUS BUSINESS 

Oil mining is , 24 

HEAD GAS 

Evidence of meaning 29 

HEIRS 

Division of royalty among „ 101 

HELIUM 

Reserved in Oil Leasing Act 263 

Reserved to the U. S • , 291 

Nature of 417 

Definition of, see Glossary 969 

HIGHWAYS 

Minerals under 13 

Obstruction of, when nuisance 177 

HUSBAND AND WIFE 

Lease by 49 

I 
IDAHO 

Severance Act of 510 

IDAHO STATUTES 

Blue Sky Laws 814 

Location of placer claims 869 

Details of locations 870 

Aflidavit required 870 



INDEX 104y 

ILLINOIS STATUTES page 

Oil and Gas Acts 596 

Record of forfeiture of lease 590 

Costs on action to forfeit 590 

Distance of well from mine opening 597 

Drill hole penetrating coal vein 597 

Directions for plugging well 597 

Proof of plugging 598 

Casing out the water 598 

Penalties for failure to plug or record 599 

Blue Sky Laws 814 

IMPROVEMENTS 

$500 for patent 245 

INCOME TAX 

See Taxation 159 

INCONTIGUOUS TRACTS 

Land Office construction concerning 371 

INDIANA STATUTES 
Oil and Gas Acts — • 

Natural gas supervisor 599 

Inspection duties 601 

Repairs of leaks 002 

Test of pipe pressure 602 

Fines, shooting wells 603 

Two days' limit to confine gas 603 

Plugging well by stranger 604 

Recovery of expenses incurred 604 

Interference with gas connections 604 

Refusal to return gas mixers 605 

Gas connections without consent . 605 

Setting fire to escaping gas 606 

Penalty \..f 600 

Flambeau lights forbidden 606 

Hours for jumbo burners 607 

Penalty 607 

Operator to furnish meters 607 

Excess charges prohibited 607 

Penalty 608 

Penalty for false gas meter 608 

Powers of oil, gas and pipe line companies 608 

Right of way for pipe line 610 

Deposit 1 quired ; 610 



1046 INDEX 

INDIANA STATUTES— eontmued. page 

Oil and Gas Acts — continued. 

Procedure to condemn 610 

Contests between claimants 612 

Practice 012 

Amendments 612 

Unknown parties 612 

Proceedings, de novo 61u 

Limitations on condemnor's right 613 

Eight of way to gas companies 613 

Special power to board of trustees 614 

Five mile limit to city companies 614 

Assessment of gas companies ' 615 

Annual statement to assessor 615 

Tax schedule /S16 

Assessment how enforced 617 

Directions for plugging wells 617 

Notice to supervisor 618 

Duties of supervisor 619 

Fee of 619 

Assistants to 619 

Protection against salt water or oil 620 

Casing out fresh water 620 

Police power of supervisor 620 

Penalty 620 

Oil Inspection Laws 797 

Method of ' , 798 

Flash test 799 

Sale or use prohibited before inspection 800 

Under supervision of State Food and Drug Commission 800 

Compensation and reports 800 

Appointment and removal of oil inspectors 801 

Bond of inspectors — duties, salaries 802 

Inspector's approval 804 

Tanks, casks or barrels to be marked 806 

Fees for inspection 806 

Commingling of contents 807 

Rejected for illuminating purposes 807 

Location for inspection 808 

Wagons or trucks — certificates — penalty 809 

Inspection brand to be erased from bands when 809 

False branding 810 

Penalty for 810 

Inspection when not required 810 

Inspectors may enter premises 810 

Blue Sky Laws ... 814 



INDEX 104 i 

INDIAN PAGE 

Contract Avith convict 153 

Eights of, referred to in Acts of Congress 216 

Osages 210 

Tribal lands 216 

Power of Congress over lands . . 217 

Lease of lands of 218 

INFANTS 

Lease by 49 

INJUNCTION 

Term of lease extended when lessee enjoined 54 

Against second lease 105 

Parties 194 

General principles 195 

Pleading , 195 

Remedy at law inadequate 196 

Irreparable injury 196 

Against drilling or cutting off gas 196 

Against drainage 197 

Instances where allowed 197 

When denied 198 

Decree cannot change possession , 199 

Lessee's fixtures 199 

Damages not waived 199 

Attempting self-relief 199 

Receiver 199 

Pay for tools 200 

Costs 200 

Of mine pending partition 206 

INSPECTION 

Tax on 158 

Of mine 163 

Of oil 163 

INSTPvOKE 

In working coal mines . ..." 458 

INSURANCE 

Prohibitions in policies 214 

INTENTION 

To abandon lease Ill 



1048 INDEX 

INTERSTATE COMMERCE page 

Pipe lines in 166 

Transportation under 160 

Common carriers 169 

Not bound to furnish tank cars 170 

IOWA STATUTES 

Blue Sky Laws 814 

IRREPARABLE INJURY 

In injunction cases 196 

v" J 

JUDICIAL DECISIONS 

Early, concerning oil and o-as 6 

JUDICIAL NOTICE 

Of incidents peculiar to oil and gas 6 

That oil is mined by wells 24 

When pay oil does not exist 24 

Oil mining a hazardous business 24 

Gas cannot be stored 24 

Inflammable traits of gas 24 

Gas is highly explosive 25 

Coal mines generate gas 25 

Instances where not taken 25 

JURISDICTION 

Questions of 189 

Of Land Office, enlarged 253 

When exclusive 254 

JURY TRIAL 

Right to, in ejectment 191 

K 

KANSAS STATUTES 
Oil and Gas Acts — 

No well within 100 ft. of right of way 621 

Penalty 621 

Strength of gas mains ti:>J 

Increase flow forbidden 621 

Penalty frli 

Casing well to exclude water 622 



INDEX 1049 

KANSAS STATUTES— continued. page 

Oil and Gas Acts — continued. 

Plugging well 022 

$500 fine 623 

Record of surrender of lease 623 

Proof of forfeiture by the owner 624 

Record not notice of term 625 

Action on failure to release 625 

Proof of demand for release 625 

County and gas inspector 626 

Oath and bond of 620 

Duty to report wells 626 

Record of inspections 627 

Inspection of pipe lines 627 

Interference with 628 

Deputy inspectors 629 

Per diem of 629 

County inspector, appointment of 630 

Operator to notify 630. 

Log of well to 630 

Penalty 630 

Fee paid by operator 631 

Protection of city water supply 631 

Penalty, limitations 631 

Pipe lines are common carriers 631 

To provide storage : 632 

Fixed rates for carriage 632 

Railroad commissioners to control 633 

Statutory damages 633 

Escape of gas 634 

Flambeau lights prohibited 635 

Jumbo burners 635 

Penalty 635 

Interfering with pipes 635 

Connection and cut-offs 636 

Firing or interfering with gas wells , . 636 

Fines and damages 636 

Wells to case against salt water 637 

Injunction to enforce 637 

Penalty and limitation 637 

Blue Sky Laws 814 

KENTUCKY STATUTES 

Oil and Gas Acts — 

Right of eminent domain conferred 638 

Series of plugs required 639 

Penalty 639 



1050 INDEX 

KENTUCKY STATUTES— continued. pagr 

Oil and Gas Acts — continued. 

Salt water must not escape 639 

Plugging section of 1802 '. 640 

Penalty for violation of 640 

Adjoining owners may close abandoned well 641 

Recovery of costs by 141 

State Oil Tax Act 642 

Production tax on oil 042 

Levy and notice : 042 

When tax attaches 042 

Registry 043 

Transporter defined 043 

Monthly reports 643 

Assessment procedure 64 ! 

Oil unsold 041 

Freight deductions 6 15 

Payment in kind 04") 

Report blanks 610 

Penalty 045 

Common Carriers Act 040 

Limiting liability of 040 

Act concerning contracts and leases 040 

Tender of delay rental 646 

Dry well 047 

Second well 047 

Protection wells 647 

Act regulating transportation ■ 648 

Pipe line shipments 648 

Duty to accept shipments 648 

Proportionate deliveries .-. 649 

Penalty and damages 649 

Blue Sky Laws" 814 

KILLING WELL 

When negligence ". 17ii 

KNOWLEDGE 

When constructive notice 152 

Of coal land value 221 

Of possession, equivalent to notice of location 233 

KNOWN-GEOLOGIC STRUCTURE 

Land within, leased to highest bidder 274* 

Bonus to be paid 274 

Minimum royalty * . . . . 274 



ind(ex 1051 

KNOWN-GEOLOGIC STRUCTURE— continued. page 

Land within, leased to highest bidder — continued. 

Advance rentals 274 

Term of lease .. . . . 275 

Reduction of royalty 275 

Procedure to procure lease on 323 

Affidavit of bidder 324 

Auction and bonus 324 

L 

LACHES 

Rescission, party attempting must act promptly 146 

Excusable delay 147 

Between locators 147 

When mineral title severed 147 

Mining- when possession 148 

When bar to specific performance 204 

LAKES 

Minerals under * 11 

LAND OFFICE 

Entry, in application for patent 246 

Mineral land segregated by 249 

Duty to determine mineral character 251 

Cannot legislate , 252 

Enlarged jurisdiction 253 

Jurisdiction when exclusive 254 

Fees and commissions , 293 

Construction of saving section 37 305 

LAND OFFICE CONSTRUCTION OF LEASING ACT 

Miscellaneous rulings 367-369 

Rulings on the oil sees 370 

Conflicting preference rights under sees. 19, 20 370 

* Permit for unwithdrawn land covered by Agricultural Entry 370 

Preference rights under sec. 20 370, 371 

Assignability of permits 370 

Incontiguous tracts 371 

Operating while application pending 371 

Pending application, land designated as oil structure 371 

Carey Act selections 371 

Drilling contracts under permit 372 

Office practice — conflicting applications 372 

Posting notice by agent 372 

Permits of corporations, limitation 372 

Preference to qualified assignees 373 

Permits in Alaska 373 



1052 INDEX 

LAND OFFICE CONSTRUCTION OF LEASING ACT— continued. 

Rulings on conflicts with agricultural entries 373-376 

Discovery on adjoining claims 376 

Right of assignees to lease 376 

Party in interest must file application 376 

Assignee of claims located before Oct. 1, 1019 377 

LAND OFFICE REGULATIONS 

Decisions on force and effect of 326 

Oil and gas regulations 330 

Permit 330 

Lease for other minerals 331 

Form and contents of application 331 

Preference right, how .secured 333 

Form and requirements of 334 

Extension of life of permit 336 

Reward for discovery . 336 

Penalty for default 337 

Permits in Alaska 337 

For reserved deposits ■...*. 338 

Lease 339 

Designation and offer of lands 339 

Notice of offer 339 

Auction of 340 

Form of 341 

Purposes 342 

Bond 342 

Commence drilling 342 

Royalty and rents 343 

Sales contract 343 

Monthly statement '._ 344 

Plats and reports 344 

Log of wells 344 

Diligence, prevention of waste, health and safety of 

workmen 344 

Taxes' and wages, freedom of purchase 345 

Reserved deposits 34f> 

Excess holdings 345 

Assignment of lease 346 

Deliver premises in case of forfeiture 340 

Rights reserved 346 

Disposition of surface 346 

Pipe lines 346 

Monopoly and fair prices 346 



INDEX 1053 

LAND OFFICE REGULATIONS— continued. 

Oil and gas regulations — continued. pagf 

Helium 346 

* Surrender of lease 347 

Purchase of materials, etc 347 

Judicial proceedings 348 

Heirs and successors 348 

Relief measures 349 

Conditions for, under sec. 18 349 

What may be granted, under sec. 18 350 

Conditions under sec. 19 352 

What may be granted under sec. 19 354 

Alaska claims, relief under sec. 22 354 

Beneficiaries under leases and permits 35(3 

Application for lease under sections 18, 19, 22 356 

Permit under sections 19, 22 356 

Royalty on past production 360 

Notice of application for lease 361 

Adverse or conflicting claims 362 

Compromises under sec. 18 A 363 

Rights of way for pipe lines 363 

Fees and commissions 364 

Repealing and saving clauses 364 

Phosphate regulations 377 

Land to which applicable 377 

Leasing area 378 

Qualification of applicants 378 

Minimum development 378 

Minimum production . .'. 379 

Application for lease 379 

Action by local office 380, 381 

Action on application 380 

Action by successful applicant 381 

Form of lease 381 

Description of land 392 

Rights reserved 382 

Disposition of surface 383 

Monopoly and fair prices 383 

Investment 383 

Bond 383 

Annual rental 384 

Royalty 384 

Record of phosphates mined 384 

Quarterly reports 384 

Reports • • 384, 385 



1054 INDEX 

LAND OFFICE REGULATIONS— con tinned. tage 

Phosphate regulations — con tin u ed. 

Mine maps 385 

Progress maps m . 385 

Minimum Production 386 

Assignment of lease 386 

Readjustment of terms 386 

Provisions controlled by State law 386 

Operating regulations 386 

Payment of wages 387 

Freedom of purchase 387 

Eight-hour work day 387 

Inspection .• . . , 3S7 

Examination of hooks and records . 387 

Operations on adjoining lands 387 

Result of forfeiture 388 

Surrender of lease 388 

Privilege of purchasing equipment 380 

Forfeiture 380 

Action by lessor to prevent damage 390 

Continuing obligation 390 

Use permits for additional lands 301 

Form of 301 

Repealing and saving clause 302 

Fees and commissions ". 302 

Form of application for lease 303 

Publishing notice of application 305 

Sodium regulations 306 

Permits authorizing exploration 306 

Qualifications of applicants 306 

Land to which applicable 306 

Rights under 306 

Reward for discovery 307 

Camp sites 307 

Contents of application for 307 

Form of 308 

Lease for sodium lands 400 

Qualifications of applicants 400 

Area and description ' 400 

Action by register and receiver 401 

Notice of application 401 

Action in General Land Office 401 

Lease by permittee " 402 

Verity of statements 402 

Lease a waiver of other claims 402 



INDEX 1055 

LAND OFFICE REGULATiqNS— -oontmyyl. 

Sodium regulations — continued. page 

Contents of application 402 

Notice of application 404 

Disposition of application 404 

Form of lease 405 

Purposes 405 

Covenants 405 

Reservations 408 

Surrender and termination ....... 409 

Purchase of materials, etc 409 

Judicial proceedings 410 

Heirs and successors 410 

Unlawful interest . . .• 411 

Use permits for camp site, etc 411 

Form of 413 

Repealing and saving clauses 413 

Fees and commissions 414 

Form of application for permit 415 

Oil shale regulations 440 

Petition and notice 441 

Form of petition 441 

Qualifications of applicants 444 

Lands and deposits to which applicable 444 

Contents of application 444 

Notice of application 446 

Disposition of application 446 

Action on application 447 

Form of lease -. 447 

Purposes 448 

Subject to limitations of act 448 

Reservations 448-450 

Lessee's covenants 448 

Prevention of monopoly 450 

Relinquishment 451 

Purchase of improvements 451 

Forfeiture 451 

Heirs and successors 452 

Readjustment of royalties 452 

Unlawful interest 4.">2 

Preferred right to a lease 453 

Fees and commissions 453 

Coal Land regulations 455 

Form of petition for coal lease 455 

Prior equities of petitioner 456 

Opening coal lands to bids 457 



1056 INDEX 

LAND OFFICE REGULATIONS— continued. 

Coal Land regulations — continued. page 

Draft of lease 457 

Amended lease 457 

Construction of lease 458 

Instroke 458 

Permits ; 458 

Free leases 459 

The regulations 459-483 

Methods of disposition 400 

Lands to which applicable 460 

Who may take 400 

Equitable rights 460 

Repealing and saving clause 461 

Fees and commissions 461 

Leasing units 462 

Minimum development 462 

Petition for leasing units 463 

Action by local office 464 

Action on petition 464 

Notice of offer 464 

Auction of lease 465 

Right to reject bids 465 

Action by bidder 465 

Action by district officers 466 

Modifications of leases 466 

Form of lease 466 

Description of land 407 

Rights reserved by lessor 467 

Disposition of surface 468 

Monopoly and fair prices 468 

Investment . 468 

Bond 468 

Annual rental 469 

Royalty 469 

Record of coal mined 469 

Quarterly reports 469 

Annual reports 470 

Mine maps 470 

Detailed map of workings 470 

Progress maps .". 471 

Royalty on minimum production 471 

Assignment of lease 471 

Readjustment of terms 471 

Operating regulations 472 

Payment of wages 472 



INDEX 1037 

LAND OFFICE REGULATIONS— continued. 

Coal Land regulations — continued. pagk 

Freedom of purchase 472 

Eight-hour day 472 

Inspection 472 

Examination of books and records 47.5 

Operations on adjoining lands 47.'* 

Result of forfeiture 47o 

Waiver of conditions 473 

Surrender of lease 474 

Privilege of purchasing equipment 474 

Forfeiture 475 

Action by lessor to prevent loss or damage 47;1 

Continuing obligation 475 

Unlawful interest 475 

Prospecting permits 476 

Character of lands 476 

Area 476 

Rights conferred 476 

Application for license 480 

Form of permit 477 

Leases to permittees 479 

Limited license to mine 479 

Area and duration 480 

Application for license 480 

Form of application for license 480 

Petition for coal permit . 484 

Corporate resolution 486 

Secretary's certificate 486 

LEAKS 

Negligence to allow, of oil and gas 172 

LEASE 

Relation of parties to 41 

Incidental advantages under 42 

The parties * 48 

By sole owner 43 

By cotenant * 46 

Accounting between 46 

Liability of lessee 48 

Waiver of, tort by 48 

Contract by, when personal 48 

By husband and wi fe 40 

U. O. R.— 67. 



1058 INDEX 

LEASE — con United. page 

By infants and lunatics 49 

To wrong party lessee 50 

By executor 50 

The term 51 

Reference to paying quantity 51 

Time to drill 52 

Lessee entitled to notice of termination 53 

Enjoined term, time of, added ' 54 

The contract 55 

Demising clause 55 

Lessee's signature not essential 55 

Unwitnessed, may be valid 55 

Unfilled blanks in 55 

Description in 56 

Construed as lease 5G 

Legal status of 57 

Freehold character '. .* 58 

What lease carries 59 

Title to the mineral 59 

Right of action on 59 

Property right of lessee 60 

Protection and drainage 61 

"Or and unless'' leases 61 

Construction 62 

Implied covenants 62 

Written insertions control printed form, when 62 

Lessor favored in 62 

General rules of 63 

Of parties 63 

Federal courts follow local law in 64 

Civil law 64 

Of, in wild cat territory 65 

Consideration , 66 

The one dollar 67 

Inadequate 69 

Promise, when not 69 

Protection covenant 70 

Bonus 71 

As consideration for 71 

Sufficiency of, question of fact 71 

Unilateral — mutuality 73 

Consideration and mutuality distinguished 74 

The surrender clause 76 

Object and effect of 77 

Not automatic 77 



INDEX 1059 

LEASE — continued. 

The surrender clause — continued. page 

Associated with delay and rentals 78 

Right to surrender 79 

Assigns protected, when 81 

Covenant to sink 82 

Reasonable time to 83 

Default on time 83 

Completion of well 8.'? 

Commencing- to drill 84 

Point of sinking 84 

Diligence 84 

Excuse for delay 85 

Runs with land 85 

Danger of drainage 86 . 

Business judgment in sinking 8b' 

Waiver of 87 

Protection 88 

Several wells may be required for 88 

Number of wells, question for jury 89 

Paying quantities, of oil or gas 90 

Denned 90 

How determined 91 

Cost of first well, where material 91 

Lessee to decide if 91 

Effect of clause on term of 92 

Lessee not bound to shoot, to show 93 

Rents and royalities 94 

Covenant for runs with land 94 

Delay rentals 94 

Right of action for 95 

Periodical 90 

Payment or tender of 97 

By deposit or check 97 

To wrong party 98 

When lease repudiated 98 

Royalty treated as purchase money 99 

None on use of oil or gas in operating 99 

Pending litigation " 100 

Recovery back of, when 1 00 

Rent, when it ceases 1 00 

When lessor's title extinguished 1 (»' I 

Royalty, when property 100 

By-products, royalty on 101 

Division of royalties among heirs 101 

First, exclusive 103 



1060 INDEX 

LEASE — continued. page 

Second lease 104 

Subject to first .- 104 

Notice to prior lessee ..*.«:..... 104 

Sublessee dealing underhand with owner 104 

Injunction against f 105 

Assignment 106, 955 

Incidents of 107 

Of sublease 107 

Surface reserves 10!) 

Eviction 109 

Suit against lessor, is not 103 

Conveyance by lessor is, when 109 

Abandonment 110 

Testifying to intent of Ill 

Re-entry not allowed Ill 

Facts amounting to Ill 

Waiver of, notice of 112 

Forfeiture 113 

Burden of proof 113 

When not enforceable 113 

Propositions decided on 114 

After sale 114 

Clause for benefit of lessor 115 

Exception to rule of 115 

When automatic 11G 

Delay to sink, perform or pay . . . 3 16 

Least favored 115 

Not allowed for breach of implied covenant 118 

Acceptance of rent, waives 118 

Demand for, when necessary 118 

Express provision for 119 

Not allowed where relief at law Ill) 

Absence of a market, excuse against 120 

Waiver of 120 

Estoppel against 120 

Kelief in equity 121 

When denied ". 122 

Practice in 1 22 

Choice of remedies 12.*! 

Alternative decree 12:< 

Special instances of 1 2'A 

Working, and option 127 

Advertising for bids, ground for specific perforhiailce 202 

When partition of, denied 205 

Proof of value, as measure of damages ...... 209 



INDEX 1061 

LEASE — continued. PAGi: 

Measure of damages for loss of 211 

Of Indian land* 218 

Of coal land by competition 263 

Of coal land to railroads 2G4 

On phosphate lands 268 

Acreage of 268 

Term of 269 

Read judgment of 269 

Of one-fourth of oil land to permittee 272 

Protection limit, under oil and gas 273 

On lands in known-geologic structure 274 

On lands withdrawn under the proclamation 275 

Royalty on 275 

Limit of area 276 

Secretary fix royalty 276 

On naval reserves 276 

Protection limit 660 feet 276 

Preference right 276 

Drilling within protection limit 277 

Fraud vitiates . . 277 

Adjustment of suits 277 

Assigns since Sept. 1, 1919 278 

Maximum acreage 278 

Authority to settle suits 278 

Of oil shale land 280 

Limitation on number of, under Oil Act . . . . ; 285 

Subject to easements 288 

Lessee may surrender when 289 

Cancellation of, under Oil Act. by Court 290 

On nonproven oil ground 320 

Form of application 321 

Procedure to procure on known-geological structure 323 

Oil and gas, L. O. Keg 339 

Notice of offer 339 

Auction of 340 

Form of 341 

Operating while application pending. Land Office construction 371 

Application for phosphate 379 

For sodium lands 400 

Acreage of, under Oil Act 421 

On unsurveyed lands r 422 

Term of various, under Act 423 

Application for coal, in Alaska 858 

Form of assignment 955 

Assignment of Federal, not permitted 956 



1062 index 

LEGAL REPRESENTATIVES paok 

Recognized in oil and gas permits or leases 280 

LESSEE 

Where must work for both oil and gas . . 31 

When must sink protection well 36 

Collusion by, as to protection well 38 

Liability of, to lessor's cotenauts 48 

Entitled to notice of termination of lease 53 

Signature not essential to lease 55 

Right to surrender 79 

To decide if oil in paying quantity 91 

Not bound to shoot to show, when ■ 93 

Notice to prior 104 

Failure to operate, measure of damages 209 

Not liable in damages for Act of Court 211 

Recognizing wrong lessor, measure of damages 213 

May surrender lease, when ". 289 

LESSOR 

Favored in construction of lease 62 

Not entitled to royalty when title extinguished 100 

Forfeiture clause for benefit of • . • • H& 

LICENSE 

When not binding on licensee 131 

To use rig, not revocable 131 

By one cotenant 131 

Statutory 131 

Limited, to mine coal 479 

Form of application for coal 481 

LICENSE TAX 

See Taxation 158 

LIEN 

By partner 141 

LIFE TENANT 

Lease by , 43 

LIMITATIONS 

On number of leases allowed 422 

LIMITED LICENSE 

To mine coal , ' 479 



INDEX 1063 

LITIGATION page 

Payment of royalty or rent pending 100 

LOCATION 

Made before passage of Oil Act protected 293 

LOCATION CERTIFICATE 

Record of 23.". 

Misdescription in 234 

Describing legal subdivisions 235 

Form of 243 

Of placer claims, statutory requirements 866-877 

LOCATION NOTICE 

Of placer 232 

Of placer claims, statutory requirements 866-877 

LOCATION OF OIL PLACER CLAIMS 

Congressional legislation 224 

Federal requirements 225 

State requirements 225 

Incidents peculiar to oil discovery 225 

Decisions on oil discoveries 227 

Seepage 227 

Shale or sand 228 

Discovery on group claims 228 

Staking and record before discovery 229 

Proof of discovery 229 

Instances of discovery '. 230 

Protection of possession before discovery 231 

Location before discovery 231 

Possession without valid discovery 234 

Knowledge equivalent to notice 233 

Record 233 

Misdescription in certificate 234 

By legal subdivisions 235 

Staking 235 

When new, required 235 

Exclusions 236 

Blanket claims 236 

Association claims 236 

Dummies in 237 

By nonresidents 237 

By corporate employees 237 

Repeated locations 238 

Excess location . . , 238 



1064 INDEX 

LOCATION OF PLACER CLAIMS— con t in ucd. pag i: 

Abandonment 239 

Annual labor 239 

Abandonment and assessment work , 240 

In lease cases 240 

By eo-owner disputing title 240 

On group claims 24.1 

Test of value of \ 241 

By administrator 24.1 

Resumption of work 241 

Oil claims distinguishes as to 241 

Perjury in affidavit of 242 

Amendment 242 

Relocation 24!i 

Presumption against 243 

On abandoned ground 243 

On restored land 243 

Location certificate, form of 243 

LOSS OF LEASE 

Measure of damages for 211 

LOUISIANA STATUTES 
Oil and Gas Acts — 

Department of mining and minerals 649 

Supervisor to enforce laws 650 

Deputy supervisor 650 

Powers of 651, 652 

Act of 1911 653 

Abandoned wells must be plugged 653 

Escape of gas or oil 654 

Supervisor prescribes regulations 654 

Penalty. Misdemeanor 654 

Adjacent owners may close wells .' 655 

Act of 1910 655 

Wild gas well, bow closed 655 

Governor may confiscate wild well 656 

Misdemeanor to allow 657 

Misdemeanor to injure pipe line 657 

Misdemeanor to fail to plug 658 

Act applies to all gas wells 658 

Act of 1916 658 

License tax on operators 658 

Quarterly statements, required 651) 

State auditor demand information 060 

Date of delinquency 661 



INDEX 1065 

LOUISIANA STATUTES— continued. 

Oil and Gas Acts — continued. page 

Additional taxes may be levied 061 

State auditor to make inquisition 0(5 1 

Sheriff to collect tax 6b 1 

Perjury to make false report 602 

Act of 1917 662 

Proof of forfeiture recorded 661? 

Damages for failure to release 66^ 

Written demand to release 66H 

Well to be cased against salt water 66o 

Abandoned wells to be plugged 663 

Penalty 664 

Act 268 of 1918— 

Defining waste of gas 664 

Power and authority of department ; 665 

Pumps and compressors regulation 665 

Must make semi-annual reports 666 

.Semi-annual reports by Department . . . . , 666 

Duty of District Judges 660 

Penalties . 660 

Act 270 of 1918 667 

Protection of source of supply of gas 667 

Offering gas for sale 667 

Not to discriminate 668 

Gas to be measured by meter 66H 

Department, see provisions complied with 66i> 

Penalties 669 

Blue Sky Laws , . . 815 

LUNATICS 

Lease by 49 

M 

MAINE 

Blue Sky Laws 815 

MAJORITY 

Controls in partnership 140 

MAPLE SHADE WELL 

Profits from 3 

MARYLAND STATUTES 

Blue Sky Laws 815 



1066 INDEX ■ 

MASSACHUSETTS STATUTES page 

Blue Sky Laws 815 

MASSACHUSETTS 

Trust agreements in 912 

MATANUSKA FIELD 

Land reserved in 830 

General regulations concerning 830 

MEASURE OF DAMAGES 

In trespass cases 207 

Distinction between oil and ore . 209 

Loss of profits . 209 

Value of lease 209 

Damages for nonproduction 209 

For failure to operate 209 

Pleading 210 

Net profits, allowed 211 

Act of Court .211 

Damages too remote . 21] 

For loss of lease 211 

Removal of casing 212 

Drilling contracts 21J 

Pipe line 212 

Mesne profits after execution sale 212 

Recognizing wrong lessor 213 

For work' in sinking : 135 

For profits to be earned in sinking ; 135 

Cost of casing, when not included in 135 

MELTING POINT 

Of the elements, see Glossary 964 

MESNE PROFITS 

When allowed 212 

MICHIGAN STATUTES 

Blue Sky Laws 815 

MILL SITE 

On phosphate lands 2ti9 

To sodium and borax lands 284 

Special provisions for, in Act 417 



INDEX 10(57 

MINE pack 

Whether an oil well is a f 9 

On public domain are "open'* 145 

Inspection of 163 

MINE MAPS 

See Land Office Regulations 

MINERAL CHARACTER 

Duty of Land Office to determine 251 

MINERAL CHARACTER OF OIL AND GAS 

Oil and gas are 8 

Whether oil well is a mine 9 

MINERAL LAND 

Segregated by Land Office 249 

MINERALS 

Oil and gas are 8 

Ownership of, under ocean, lakes and rivers 31 

Under highways 13 

Reservation of, in lot dedication 13 

Conveyance of 15 

Severance, exception and reservations in conveyance 15 

Severance of, in U. S. patents 19 

Title to, under lease 59 

Estate in severed, partition of 205 

Enumeration of, in Leasing Act 262 

Covered by v Oil and Gas Act 294 

What, included in withdrawal legislation 503 

MINERAL SURVEYOR 

Disqualified to make application for patent 893 

MINING 

Whether drilling or pumping is 9 

MINING CLAIM 

Partition of 205 

Locations before passage of Oil Act protected 293 

In national forests '. . . / 512 

MINNESOTA STATUTES 

Bue Sky Laws 815 



1068 INDEX 

MINORS page 

Leases shall provide for protection of 424 

M1KZOEFF WELL 

Daily flow of 3 

MISSISSIPPI STATUTES 

Blue Sky Laws 816 

MISSOURI STATUTES 

Blue Sky Laws 810 

MONOPOLY 

In coal leases prohibited 468 

MONTANA STATUTES 

Blue Sky Laws r 816 

Location of placer claims 871 

Verification required 872 

MONUMENT 

Erection, for oil and gas permit ". 271 

Preliminary, on nonproven ground . 308 

On placer claims, statutory requirements 866-877 

MUTUALITY 

In leases 73 

Consideration and, distinguished 74 

Of option 125 

N 

NAPTHA 

Storage of, when negligence 172 

NATIONAL FORESTS 

Withdrawal of land for 511 

Administration of, by department 511 

Mining claims in 512 

NATURAL GAS 

Is not heat but a fuel 30 

NAVAL RESERVES 

Leases of land in 276 

Area of the reserves 515 



INDEX 1069 

NAVAL RESERVES— continued. pagk 

Relation as to Leasing Act , 515 

History of 5L~ 

Receipts, how deposited 292 

NAVY PETROLEUM FUND 

Creation of 508 

NEBRASKA STATUTES 
Oil and Gas Act — 

Reward for first oil or gas well 66U 

Blue Sky Laws 810 

NEGLIGENCE 

Of pipe line 167 

When not liable for overflow 168 

NEGLIGENCE, EXPLOSIONS AND OTHER ACCIDENTS 

Flowage from wells 171 

Selling one thing for another may create a liability 171 

Storage cases, vapor 172 

Leaks, floating oil 172 

Seepage 173 

Oil below standard 173 

In transit 173 

Statutory liability 174 

Miscellaneous cases 174 

Parties 174 

Rule of evidence 175 

Killing well 175 

NENANA FIELD 

Land reserved in 831 

General regulations concerning 831 

Modification of regulations for 864 

NET PROFITS 

Defined . 142 

Working interest 142 

NEVADA STATUTES 

Location of placers 873 

NEW HAMPSHIRE STATUTES 

Blue Sky Laws , , 816 



1070 INDEX 

NEW JERSEY STATUTES page 

Blue Sky Laws 81ff 

NEW MEXICO STATUTES 

Oil and Gas Acts 069 

Well to be eased against water 669 

How wells to be plugged 670 

Plugged by third party 670 

Penalty 671 

Location of placers 874 

NEW YORK STATUTES 

Oil and Gas Acts 671 

Plugging abandoned wells 671 

Misdemeanor to fail 672 

Neighbor, at owners' expense 672 

Incorporation of pipe line company 672 

Must show stock subscribed . 673 

Location of line, Map 673 

Hearing to adjust line . . , 674 

Condemnation 675 

City streets 675 

Rights at railroad crossings 676 

Bridges at crossings 676 

Precaution against leakes 676 

Consent of municipal authorities 677 

Consent to enter villages, and cities 677 

Across Indian reservations 678 

Over State or municipal lands 678 

Additional powers to 678 

Storage 679 

Rights of the public 679 

Are common carriers 679 

Rates and charges posted 679 

Vouchers and deliveries 680 

Monthly statements 681 

Fencing 681 

Crossings 681 

Gates 681 

Damages 681 

Taxed same as railroads 682 

Blue Sky Laws 817 

NONPROVEN OIL GROUND ♦ 

Procedure to procure permit 308 

Preliminary monument ' 308 



INMSX 1071 



NONPROVEN OIL GROUND— continued. pagk 

Notice of application for permit 30S 

Contents of application for permit 309 

Preference right 310 

Conflict between applications 311 

Form of application for permit ' 312 

Bond of permittee 314 

Notice that permit is granted 316 

Right to permit 317 

Extension of permit 318 

Petition for extension 318 

Lease on 320 

Form of application for 321 

Pre-emption right to permittee 321 

NONRESIDENTS 

Taxation of 160 

Location of placer claim by 237 

Application for patent by 802 

NORTH CAROLINA STATUTE8 

Blue Sky Laws 817 

NORTH DAKOTA STATUTES 

Blue Sky Laws 817 

NOTICE 

Of termination of lease 53 

To prior lessee 104 

Waiver of, in abandonment 112 

Posting, of application for oil and gas permit 27.1 

Of granting of permit to prospect oil and gas 271 

Posting, by agent, Land Office construction 372 

Of application for sodium lease 401 

NUISANCE 

Oil wells as 176 

Obstructing highways 177 

Gasoline stations, refineries 177 

Gas works 178 

NUMBER OF LEASES 

Limitation on 422 



3072 INDEX 

o 

OCEAN page 

Ownership of minerals under 11 

OHIO STATUTES 

Oil and Gas Acts — 

Casing to protect against water 682 

Abandoned well to be cemented 083 

Stranger's act if owners fail to comply 683 

Costs and expenses a lien 683 

Waste of gas prohibited 684 

Flambeau lights 68-1 

Jumbo burners 684 

Penalty 684 

Gas and oil leases to be recorded 685 

Failure to record 685 

Parties to cancellation suits 685 

Gas and Oil wells 686 

Map of coal, gas and oil lands 680 

Map of coal mine on oil land 68t» 

Sealing of wells, penetrating coal 680 

When abandoned 687 

Penalty 687 

Map of, in coal townships 688 

Details of 688 

300 ft. protection 089 

Permit to drill required . . . ^ 689 

Map demanded before permit 689 

Abandonment regulated 690 

Abandoned wells plugged and cemented 690 

Casing when well penetrates mine 691 

"Coal bearing or coal producing township" 632 

Designation and supervision of coal townships 692 

Supervision of permit-, maps and plugging 692 

Designation of counties, — regulations 693 

Enforcement of regulations 693 

Right of appeal 693 

Penalty against coroner 693 

Penalties against owners and lessees 694 

Against superintendent or foreman 694 

In fire-damp cases 695 . 

Loitering and liquor 695 



INDEX 107 o 

OHIO STATUTES— con tin ncd. 

Oil and Gas Acts — continued. pagi: 

Further penalties 090 

Well not properly plugged 090 

Sale of prohibited lighting material 090 

Approval of Chief Inspector, luniinants 097 

Use of prohibited lighting material 097 

Blue Sky Laws 817 

OIL 

Found in salt well 20 

Distinction between, and gas ."0 

Contracts for sale of 137 

For delivery of .. 1 .'57 

Inspection of 103 

Delivery of to pipe line ] 08 

Below standard, when negligence 1 73 

Distinction between, and ore as to measure of damages 209 

Incidents peculiar to discovery of .. 225 

Locations before passage of Oil Act protected 293 

Analysis of royalty on •. 425 

Included in withdrawal legislation 503 

Definition of, see Glossary 971 

OIL AND GAS 

Classical and scriptural mention of 2 

Quantity to be expected in wells 3 

Associated lluids 4 

Source of title 6 

Judicial notice of incidents peculiar to 

Early decisions concerning . . . * 

Mineral character of '. 8 

Ownership of, by owner of land 11 

Fugacious character of 20 

Are ferae nature 20 

Tenant no estate in, till tapped 21 

Analogy between, and game and fish 21 

Must be reduced to possession 21 

Wells distinguished . . 2t> 

Oil found in salt well , 26 

Gas in well sunk for oil 27 

Gas rent when not demandable 27 

When impossible to save both 28 

Gas found when oil contracted for 28 

M. O. R.— 68. 



107+ INDEX 

OIL AND GAS — continued. page 

Head gas , 29 

Gas from oil well 29 

Injury from water 29 

Natural gas is not heat 30 

Gas used on premises 30 

Distinction between .* 30 

Workable for both 31 

Waste of 187 

Prevention of waste 273 

Waste of, prohibited 423 

OIL AND GAS LANDS 

Sections 13-20 of Oil Leasing Act 270 

Prospecting permit, 270 

Drill within six months 270 

Sink 500 feet and 2000 feet 270 

Two years extension . . 270 

Shape of claim 271 

Monument and notice 271 

Thirty day preference right 271 

Additional notice 271 

Staking corners 27 1 

Alaska permits and preference rights 272 

Lease of one-fourth to permittee 272 

Minimum limit 160 acres 272 

Surveys 272 

Term of lease 273 

Royalty .273 

Limit of royalty 273 

Preference right to other three-fourths 273 

Twenty per cent royalty until lease applied for 273 

Protection limit 273 

Prevention of waste 273 

Forfeiture imposed by Court 274 

Land within geologic structure 274 

Bonus 274 

Minimum royalty 12-1 per cent 274 

Advance rental 274 

Term, twenty years 27f> 



Renewals 



i .i 



Reduction of royalty 27f> 

Leases on land withdrawn under — 

Proclamation 27T> 

Royalty on 27f> 

Acreage 276 

Secretary fix royalty ; . . . 276 



INDEX 107 f> 

OIL AND GAS LANDS— continued* i-aok 

Leases on naval reserves 276 

Protection limit 660 feet 276 

Preference right . v 276 



Drilling within the protection limit 



i i 



Fraud vitiates 27 ." 

Adjustment of suits 277 

Land claimed by two parties 277 

Assigns since September 1, 1919 278 

Maximum acreage 278 

Authority to settle suits 278 

Claims having no discovery on October 1, 1919 278 

Claims having discovery entitled to lease 279 

Royalty under such leases 279 

Navy reserves excepted 279 

Fraud 279 

Legal representatives recognized 280 

Permits or leases where surface and mineral severed 280 

Railroad grants excepted 280 

Severed holdings may combine 280 

OIL AND GAS LEASING ACT 

Introductory 260 

Full text of 262 

Enumeration of minerals 262 

Exclusions 262 

To whom available 262 

Helium reserved 263 

Stock ownership prohibited to certain aliens 263 

Coal lands sections of act 2-8 263 

Leased by competition 263 

Alaska excepted 263 

Coal prospecting permits 264 

Advertising required 264 

Leases to railroads 264 

Additional lands to limit of 2,560 acres 265 

Coal exhausted , 265 

Consolidation of leases ' 265 

Uniting coal or phosphate leases 260 

Royalty 260 

Minimum tonnage 266 

Strikes 266 

Suspension of work 266 

No royalty on coal for private use 267 

Coal leases to cities 267 



1076 INDEX 

OIL AND GAS LEASING ACT— continued. tagj: 

Phosphate lands, sees. 9-12 268 

Lease of 268 

Limit, 2,560 acres 268 

Royalty 268 

Term of lease 260 

Readjustment of lease 269 

Suspension of work 261) 

Mill sites, on 269 

Oil and gas land sees. 13-20 270 

Prospecting permit, acreage 270 

Drill within six months 270 

Sink 500 ft. and 2,000 ft 270 

Two years extension- 270 

Shape of claims 271 

Monument and notice 271 

Thirty day preference right 271 

Additional notice 271 

Staking corner 271 

Alaska permits and preference rights 272 

Lease of one-fourth to permittee 272 

Minimum limit 160 acres 272 

Survey 272 

Term of lease . 273 

Royalties . . 273 

Limit of 273 

Preference right to three-fourths 273 

Twenty per cent royalty until lease applied for 273 

Protection limit 273 

Prevention of waste 273 

Forfeiture enforced hy Court 271 

Land within geologic structure 274 

Bonus 274 

Minimum royalty 12$ per cent 274 

Advance rental 274 

Term twenty years 27f> 

Renewals 27f> 

Reduction of royally 27a 

Leases on land withdrawn under the Proclamation 27f> 

Royalty on 27T> 

Limit of area 275 

Secretary fix royalty 276 

Leases on Naval Reserves 276 

Protection limit, 660 feet 276 

Preference right 276 

Drilling within protection limit 277 



INDEX 1077 



OIL AND GAS LEASING ACT— con tinned. 

Leases on Naval Reserves — continued. page 

Fraud vitiates 277 

Adjustment of suits 277 

Land claimed by two parties 277 

Assigns since September 1, 1919 27S 

Maximum acreage 27S 

Authority, to settle suits 278 

Claims having no discovery on October 1, 1919 278 

Claims having discovery entitled to lease 279 

Royalty under such leases 279 

Naval Reserves excepted J 270 

Fraud 279 

Legal representatives recognized 280 

Permits or leases where surface and mineral severed 280 

Railroad grants excepted 280 

Severed holdings, may combine 28H 

Oil Shale sec. 21 280 

Leases 280 

5,120 acres limit 280 

Royalty 280 

Readjustment 280 

Waiver of rent and royalty 28\ 

Locations may relinquish and come under Act 281 

Fraud disqualifies 282 

Only one lease alloAved 282 

Alaska oil lands, sec. 22 282 

Claims without discovery 282 

Readjustment 282 

Waiver of rent and royalty 282 

Fraud disqualifies 283 

Sodium and Borax, sees. 23-25 283 

Two year permits 283 

San Bernardino county excepted 28H 

Leases to permittees 283 

Forty acre mill site privileges 284 

General provisions of act 281 

Power to cancel prospecting permit 285 

Limitation on number of leases 28f> 

Limitations on corporate holdings 285 

Forfeiture may be ordered by court 280 

Refinery, pipe line and railroad combinations 286 

Such combinations must be approved 2SG 

Trust or conspiracy ground of forfeiture 280 

Rights of way to pipe line 287 



1078 INDEX 



OIL AND GAg LEASING ACT— continued. 

General provisions of act — continued. page 

Pipe lines may not discriminate 287 

Forfeiture by pipe line 288 

Leases and permits subject to easements 288 

Easements and surface rights may be reserved 288 

Permits for 288 

Assigning and subletting forbidden 289 

Lessee may surrender 289 

Terms to be expressed in leases 289 

To prevent waste 289 

Eight hour day 289 

Wages bimonthly 289 

Measuring coal 289 

Miscellaneous covenants ! / 290 

State Laws to be respected 290 

Court may cancel or allow damages or other relief 290 

Secretary prescribe rules and regulations 290 

Police power and taxes ■ 290 

Papers to be verified 291 

Act applies where surface and mineral severed 291 

Distribution of royalties 291 

Naval Reserve receipts, how deposited , 292 

Payment of royalty in kind 292 

Secretary may sell oil and gas royalty 292 

Private sale of royalty 292 

Locations before act, protected : 293 

Right to perfect discovery 293 

Fees and commissions to land officers 293 

Analysis of Act — 

Section 1 minerals and territory covered 294 

Helium 294 

Exclusions 294 

Parties 294 

Reciprocity 294 

Sections 2-8 — 

Confined to coal 294 

Repeals by implication 29i> 

Alaska coal 295 

Sections 9-12 — 

Confined to phosphate 295 

Former statutes relating to . 295 

Sections 13-17 - — 

Confined to oil and gas 295 



INDEX 1079 



OIL AND GAS LEASING ACT— continued. 

Analysis Act — continued. page 

Wells in withdrawn lands 297 

Section ISA- 
Settlement of government suits 298 

Section 19 — 

Claimants entitled to permits and leases 298 

Section 20 — 

Preference right to permit >. 298 

Section 21 — 

Status of oil shale claims 299 

Section 22, confined to Alaska 301 

Sections 23-25, confined to sodium and borax 301 

Section 26, power of Secretary to cancel permits 301 

Section 27, limits number of leases 301 

Section 28, confined to easements 301 

Section 29, leases subject to easements 301 

Section 30, subleases and assignments 302 

Power of secretary to make regulations 302 

Section 31, settlement of disputes 303 

Section 32, authorizes rules and regulations 304 

Sections 33-36, verifications, forms and blanks 304 

Section 37, saving clause 305 

Future discovery allowed 305 

Section 38, fees and commissions 306 

Land Office, construction of 367 

Classes of claims covered 367 

Killings on the oil sections ..-...• 370 

Conflicting preference rights 370 

Permit for land covered by agricultural entry 370 

Preference rights under sec. 20 370, 371 

Assignability of permit 370 

Incontiguous tracts 371 

Operating while application pending 37 1 

Land designated as oil structure pending application 371 

Carey Act selections 371 

Drilling contracts under permits 37^ 

Conflicting applications 372 

Posting notice by agent 37 2 

Permits of corporations '. . . 372 

Preference rights to qualified assignees 373 

Permits in Alaska 37.1 

Conflicts with agricultural entries 373 

Discovery on adjoining claims 376 

Pvight of assignee to lease 376 



1080 INDEX 

OIL AND GAS LEASING ACT— continued. 

Land Office, construction of — continued. page 

Party in interest must file application 37t> 

Assignee of claim located before October 1, 1919 377 

Reservations of coal land in Alaska 822 

Exceptions of coal land in Alaska 822 

OIL AND GAS REGULATIONS 

See Land Office Regulations 330 

OIL FIELDS 

Where found 1 

Classical and scriptural mention 2 

Pennsylvania 3 

Russia 3 

OIL INSPECTION LAW 

Indiana Act of 1919 797 

Method of 798 

Flash test 120 degrees Fahrenheit 799 

Sale or use prohibited before inspection 800 

Under supervision of state food and drug commissioner 800 

Compensation and reports 800 

Appointment and removal of oil inspectors 801 

Bond of inspectors, duties, salaries 802 

Inspectors' approval 804 

Tanks, casks or barrels to be marked 806 

Fees for inspection 806 

Commingling of contents 807 

Rejected for illuminating purposes 807 

Location for inspection 80S 

Wagons or trucks, certificates, penalty . 809 

Inspection brand erased from barrels, etc.. when 80*' 

False branding 810 

Penalty 810 

Inspection, when not required 810 

Inspectors may enter premises 810 

OIL IN TRANSIT 

Taxation of 160 

OIL LANDS 

Source of title to 6 

Description of, in conveyance 16 

Deed and lease of, combined 17 

Not partitioned in kind , 205 



INDEX 1081 

OIL PLACER CLAIMS pagf 

See location of oil placer claims 224 

Making discovery after passage of Oil Act 298 

OIL SAND 

Contract to sink to 133 

OIL SHALE 

To be located as placers 222 

Locations before passage of Oil Act protected 293 

Analysis of royalty on 426 

OIL SHALE LAND 

Section 21 of Oil Leasing Act 280 

Leases of 280 

5,120 acres limit 280 

Royalty 280 

Secretary may waive rent and royalty 281 

Locations may relinquish 281 

Only one lease allowed 282 

OIL SHALE LAND OFFICE REGULATIONS 

Petition and notice 441 

Form of petition 441 

Qualifications of applicants 444 

Land to which applicable - 444 

Contents of application 444 

Notice of application 446 

Disposition of application 446 

Action on application 447 

Form of lease 447 

Preferred rights to lease 453 

OIL WELL 

Judicial notice that oil is mined by 6 

Whether a mine f» 

Gas found in 2£ 

Where oil contracted for 28 

Distinction between oil and gas well :;0 

Not a nuisance 176 

OKLAHOMA 

Form of lease 488 

Trust Agreement Act . . . 913 



1082 INDEX 

OKLAHOMA STATUTES 

Oil and Gas Acta- - , page 

Gas pipe lines 698 

Gas corporations 698 

Gas to be kept within State 698 

Foreign lines not licensed 698 

Pipe line companies comply with Article 699 

Right of way damages must be paid 699 

Inspection 699 

Pressure pumps prohibited 699 

Transporting out of state 700 

Proceedings and penalty 700 

Sale of property, revocation of charter 701 

Lines over private property 701 

Corporations become domestic 702 

Information to be furnished commission 702 

Domestic, may erect pumping stations 703 

May cross highways 703 

Oil pipe lines 703 

Must comply with statute, penalty 703 

Right of way 704 

Foreign corporations 704 

Common purchasers — required to purchase 705 

Exceptions 705 

Are common carriers, discrimination prohibited 706 

Not to be interested in producing 706 

Acceptance of laws and plats to be filed 706 

Domestic, have right of way 707 

Who may have right of eminent domain 707 

Commission may extend time 708 

Penalty for violations 708 

Suspension of, when 708 

Certified transcript, as evidence 709 

Commission may extend time for operation of law 709 

Purchase of gas from foreign corporation 709 

Gas from Interstate pipe lines 709 

License from Commission 70!) 

Foreign and domestic corporations, separate ownership.. 7]0 

Act regulating carrying of gas 710 

Who subject to Act, vested rights excepted 710 

Right of way, eminent domain 711 

Common purchasers, requirements, exemptions 711 

Pipe line common carrier 712 

Noncompliance with act, effect 713 



INDEX 106o 



OKLAHOMA STATUTES— continued. 

Oil and Gas Acts — continued. page 

Prerequisite to carrying 714 

Records for Commission 714 

Right of way, highways, eminent domain 714 

Filing record with commission 715 

Only 25% capacity of well, limit 715 

Meters — requirements 715 

Violation of Act — punishment 71(5 

Receivership, procedure 717 

Evidence — reports of gas companies 717 

Enforcement by commission, appeals 717 

Waste, plugging and inspection 718 

Oil wells and gas wells distinguished 718 

Unnecessary leaks 718 

Jumbo and flambeau lights 719 

Gas light curfew 719 

Daylight use of gas 719 

Streams to be protected — salt water 719 

Abandoned wells, how plugged 719 

Chief mine inspector and deputies; 720 

Owner to furnish log to inspector 721 

Setting fires 722 

Interference with pipes 722 

Penalties imposed 722 

Act as to ownership of gas 722 

PI9 



Surface owners own gas 



i z^ 



Equalized division of product 723 

Commission to divide among gas owners 723 

Excess share of gas 724 

Violations made penitentiary offense 724 

Act to prevent waste . 724 

Implied waste of gas 724 

Enlarged definition of waste 72 i 

Power of commission to distribute 725 

Equitable distribution to purchasers 726 

Judicial power conferred on Commission 726 

Review by Supreme Court 727 

Commission make rules and regulations 727 

Acceptance of Act to be filed : 726 

Duties of mine inspector 728 

Separate construction of sees 728 

Penalties of fine and imprisonment 728 



1084 INDEX 

OKLAHOMA STATUTES— continued. 

Oil and Gas Acts — continued. 

Public Utilities Act — page 

Definition to public utilities 720 

Commission's jurisdiction over utilities 729 

Implied powers 730 

Contempt 730 

Record of public utility business 730 

Orders of commission 730 

Right of appeal from 730 

Emergency 731 

Waste and Corporation Commission Act 731 

Waste of oil prohibited 731 

Commission to determine value of oil 731 

Waste defined 731 

Production of oil from common source . 732 

Inequitable distribution prohibited 732 

Gauge of well to be taken 732 

Hearings before commission 743 

May punish for contempt 743 

Appeals to Supreme Court, supersedeas 733 

Contempt, misdemeanor 733 

State may apply for receiver 734 

Oil and Gas Department Act 734 

Department created 734 

Conservation agent 7 3 1 

Powers of corporation commissioner 735 

Commission prescribe plugging regulations 735 

Inspection of oil and products 735 

Pay of inspector 736 

Oil leases on State lands — 

Lease of school lands 734> 

Segregation of oil lands 730 

Term of lease, 5 years 737 

Appraisement on quitting 737 

Conditions of lease, bond 737 

Commissioners to publish rules 73S 

Surface injuries '. . . . . 73^ 

Disposition of bonuses and royalties 73!) 

License to foreign corporations to sell gas 730 

Interstate pipe lines, license required 730 

Interlocking foreign and domestic lines 730 

Standard meters 740 

Fines imposed 740 



INDEX 108f> 

OPEN MINES pagi; 

Opened or unopened mines 144 

Public domain, mines all open : 145 

OPINION 

As to value 152 

OPTION • 

Consideration and mutuality 125 

Naked 126 

Time of 126 

Extension of 127 

Possession under 127 

And working lease 127 

Rent for delay on 128 

For speculative purposes i 128 

Special instances of 129 

Repudiation of 129 

Is a chattel real 129 

Time allowed to secure assignment, when 204 

To purchase in lease 500 

Assignment of . , , , , 956 

"OR AND UNDER" 

Meaning in lease , 61 

ORE 

Distinction between, and oil as to measure of damages 209 

OREGON STATUTES 

Blue Sky Laws 818 

OSAGE INDIANS 

See Indians ' i^lti 

OWNERSHIP OF OIL AND GAS 

Lands owned in fee 11 

Ocean, lakes and rivers 11 

Sea shore ,. . 11 

River beds and lakes 12 

Under highways 12 

Separate, of oil and minerals 18, 113 



1086 INDEX 



p 



PARTIES PAGE 

Relation of in lease 41 

To leases '. 43 

Construction of, -to terms of lea«e 63 

In injunction suit 194' 

PARTITION • 

Of mining claim 205 

Of estate in severed minerals 205 

Injunction pending , . 205 

Instances of 205 

PARTNERSHIP 

What creates the relation 139 

Good faith between 140 

Majority control 140 

Pay to one partner for time 140 

Borrowing money 140 

Assessments . . ., 141 

Deserting partner 141 

Lien of one partner 141 

PATENT 

Application for 245 

$500 improvements 245 

Roads and trails as improvements , 245 

Dredge or derrick as improvements 245 

Attack on after entry 246 

Equivalent to royal grant 247 

Vests title in fee 247 

Subsequent discovery of mineral 248 

Cures breaks in chain of title 248 

Trusts i 248 

Fraud in obtaining 249 

Mineral land segregated by Land Office 249 

Receiver's receipt 250 

Record of 250 

Application for on surveyed land 878 

Forms in . 878-897 

PAYING QUANTITY 

Meaning of, in lease 51 

Term defined 90 

How determined .' 91 



INDEX - 10^7 

PAYING QUANTITY— con tin ucd. ■, . page 

Cost of first well when material 91 

Lessee to decide if there is 91 

Effect of clause on term of lease 92 

Lessee not bound to shoot, to show 93 

PAYMENT 

Of rents and royalties 97 

By deposit or check 97 

To wrong party 98 

When lease repudiated 98 

PENNSYLVANIA 

Oil fields in 3 

PENNSYLVANIA STATUTES 
Oil and Gas Acts — 

Wells to be plugged against water , 740 

Fine for omission 741 

Adjoiners, when may plug 741-743 

Details of plugging 743 

Penalty 742 

Details of plugging and filling 742 

Penalty, $200 743 

Duty to prevent escape of salt water , 743 

Interested party plug well 744 

Accounting between cotenants of oil wells 744 

Nonjoining co-owner not bound 745 

Malicious injury to well, tank or pipe 745 

Mining Cotenants Act extended to oil 745 

Consolidation of oil mining companies 746 

Merger of oil companies 746 

Consolidation of oil companies 746 

Companies may hold stock, etc , of other companies 747 

Dissolution of oil corporations 747 

Oil transportation and storage 748 

Receipts or vouchers for oil delivered 748 

Duplicate receipts when allowed . . .'. 748 

Reissue of vouchers forbidden 749 

Receipts to be surrendered 749 

Notice before issue of duplicate 749 

Receipt how cancelled 749 

Written order required 750 

Monthly statements from pipe line and storage companies . . 750 

Details of 751 

Oil in stock to tally with outstanding orders 752 



1088 INDEX 

PENNSYLVANIA STATUTES— contiv ucd. 

Oil and Gas Acts — continued. page 

Fine and imprisonment both imposed 752 

Disposing of oil without owner's consent 752 

Failure to report monthly 753 

Oil vouchers negotiable 753 

Must allow inspection with use of tools *■ 753 

Penalty 754 

Not over 25 examiners to be appointed 755 

Examiners to gauge and inspect 750 

Details of examiner's reports 756 

Penalty for false reports 757 

Refusal of access a misdemeanor 757 

Appropriation of fines 758 

Payment of expenses 758 

Proviso as to appointment of inspectors 758 

Pipe line companies 758 

Local Act extended . 758 

Change of location of pipes 759 

Preferences forbidden 758 

Act of 1874 amended 750 

Pipe line companies to be recorded 750 

Co/porate powers and liabilities of 700 

Procedure to condemn right of way 762 

Duty to furnish gas to consumers 765 

Abandoned wells to be filled and plugged. . 765 

Penalty 765 

Adjoiners may plug wells 766 

Natural gas companies may deal in fuel gas 760 

Blue Sky Laws 818 

PERIODICAL 

Payment of rent 00 

PERJURY 

In affidavit of annual labor 24-2 

PERMANENT IMPROVEMENTS 

When ground for *pecitic performance 202 

PERMIT 

To prospect for oil or gas 270 

Acreage allowed 270 

In Alaska 272 

Where surface and mineral severed 280 



INDEX 1089 

PERMIT — con ( in ued. tag e 

Sodium and borax 283 

For easements 288 

On nonproven oil ground 308 

Application for 308 

Contents of 30!) 

Form of . . 312 

Bond of permittee 314 

Notice of granting 316 

Right to 317 

Extension of 318 

Petition for extension of 318 

Oil and gas, L. 0. Reg , 330 

Form and contents of application 331 

Preference right, how secured 333 

Form of 334 

Extension of life of 336 

Reward for discovery 337 

Penalty for default 337 

In Alaska 337 

For reserved deposits 338 

Preference right to surface owner 338 

Where land covered by agricultural entry 370 

Operating while application pending, Land Office construction... 371 

Designation of oil structure pending application 371 

Number held by corporation. Land Office construction 372 

For sodium exploration 396 

Contents of application for 398 

Form of 398 

Form of sodium 398 

Acreage of, under Oil Act 421 

On unsurveyed land 422 

To prospect for coal 458 

Form of petition for coal . . ., 484 

Coal mining in Alaska •■. . 859 

PERMITTEE 

Lease of one-fourth to 272 

Minimum limit of 160 acres 272 

Preference right to three-fourths 273 

Leases to, of sodium land 283 

Pre-emption right to lease on nonproven oil ground 321 

Lease of sodium lands by 402 

PERPETUAL LEASE 

Taxation of 160 

O. R.— 69. 




1090 INDEX 

PETROLEUM page 

See Oil and Gas 

Chemical composition and other incidents 5 

Definition of, see Glossary 974 

PHOSPHATE 

Locations before passage of Oil Act protected 293 

Analysis of royalty on 425 

Included in withdrawal legislation v 503 

Definition of, see Glossary 975 

PHOSPHATE AND SODIUM 

Special provisions for in Act 417 

PHOSPHATE LAND 

Sections 9-12 of Oil Leasing Act . , 268 

Lease of 268 

Limit 2560 acres , 268 

Royalties 268 

Term of lease 269 

Readjustment of lease 269 

Suspension of work 269 

Mill site on 269 

PHOSPHATE, LAND OFFICE REGULATIONS 

Land to which applicable 377 

Leasing area ^ ........ . 378 

Qualification of applicant 378 

Minimum development 378 

Application for lease 379 

Action by local office 380, 38i 

Action on application 380 

Action by successful applicant . . .'. 381 

Form of lease 381 

Use permits for additional land 391 

Repealing and saving clause 392 

Form of application for lease 393 

PHOSPHATE LEASES 

Uniting coal leases with 266 

PICKETT ACT 

Review of Statutes concerning 255 



INDEX 1091 

PIPE LINES page 

Contract between, and well 138 

Across public domain 165 

Are common carriers 165 

Condemnation by 10J 

Incidents of ] 66 

In interstate commerce 16& 

Eight to abandon -10 7 

Limiting pressure 167 

Negligence of 16 .' 

When not liable 1 i 

Delivery of oil to 1 68 

Destruction of, measure of damages . 212 

Combinations with refineries and railroad 286 

Eight of way to 287 

May not discriminate 287 

Forfeiture of right of way 288 

Right of way for, L. 0. Reg 363 

Easements, and right of way 80.) 

PLACERS CLAIMS 

Oil shale located as 222 

See Location of Oil Placer Claims 22 i 

Number that may be located by one person 238 

Annual labor on 239, 240 

Locations before passage of Oil Act protected 2)3 

Perfecting discovery after passage of Oil Act 293 

Statutory requirements for location of 866 

PLACER PATENT APPLICATION 

On government subdivisions 878 

First set of papers 878 

Notice of application 878 

Proof of posting notice 87 ) 

Conspicuous posting 880 

Application for patent 88 J 

What application must show 882 

Corroborating affidavit 883 

Proof of citizenship 88 1 

Naturalized citizens, corporations 88 i 

Newspaper designated 884 

. t Abstract of title .......: 885 

Methods of notice mandatory 88 > 

Lode claims within placers 880 

Proof that no known lode exists in placer 886 



1092 INDEX 

PLACER PATENT APPLICATION— continued. page 

Second set or final entry papers 887 

Proof of notice remaining posted on claim 888 

Affidavit on information 888 

Destruction of posted notice 888 

Certificate of publication 889 

Proof of sums paid 880 

Application to purchase 890 

Final certificate of entry 891 

Affidavits, where and before whom made 891 

By nonresident owners 892 

Power of attorney to apply for 892 

Mineral surveyor disqualified to make 893 

Application by corporation 893 

Resolution by corporation 893 

Adverse claims 894 

Form of . 895-897 

Verification 897 

Suit in support of 837 

Suspended proceedings 898 

PLEADING 

Fraud 151 

In injunction suit 195 

In specific performance 202 

In damage cases 210 

PLUGGING WELL 

See Waste of Oil or Gas 187 

Statutes of different states — 

POLICE POWER 

City ordinances ■ ] 61 

Public utilities 161 

Gas rates 161 

Of States over Oil Act lessees 290 

POSSESSION 

Oil and gas must be reduced to , 20 

Under option 127 

Secret underground mining, not hostile , 148 

Not changed by injunction , 499 

Protection by, before discovery 231 

Without valid location , 232 



INDEX 1098 

POSSESSORY TITLE page 

Taxation of 157 

POTASH 

How may be pateuted 508 

Definition of, see Glossary 975 

POWER OF ATTORNEY 

To apply for patent 892 

PRACTISE 

In left ing leases 439 

PREFERENCE PERMITS 

To assignees, Land. Office construction 373 

PREFERENCE RIGHT 

For permit to prospect for oil and gas 271 

In Alaska 272 

Of permittee to three-fourths of land 273 

To permit on nonproven oil ground 310 

To oil and gas permit, L. 0. Reg 333 

Land Office construction of sec. 20 370, 371 

Under Oil Act, acreage of 421 

PRESIDENTIAL RESERVES 

See Alaska Coal Lands 'i . 830 

PRESSURE 

Limiting, in pipe line 167 

PROCEEDS 

Gross, taxation of 357 

Net, taxation of 158 

PROCLAMATION 

Of September 27, 1909 433 

Beneficiaries under 433 

Compromises under 433 

PROFITS 

Loss of, as measure of damages 209 

Net, when allowed as measure of damages 211 

PROMISE 

When not consideration for lease 69 



1094 INDEX 

PROOF PAGF 

Of discovery 220 

PROPERTY 

Royalty as, of lessee 100 

PROSPECTING PERMIT 

For oil and gas 270 

For coal 264, 476 

Form of 478 

PROTECTION 

Territorial extent 32 

Spacing of wells * . . . . 33 

Implied covenant for 34 

Successive wells for 34 

Compulsion by Court to sink for 35 

Contracting for 36 

Limiting by contract 36 

Demand for 37 

Alternative decree for 37 

Point of sinking protecting well 37 

Owner may sink wells for 37 

Lessee to decide as to necessity 38 

Collusion by lessee 38 

Remedies to secure 38 

Pending litigation . . . . . 39 

In wildcat territory 39 

Expert evidence as to wells needed 39 

Of buildings 39 

Practise in actions concerning 40 

Right to, under lease 61 

Covenants for, as consideration 70 

Number of wells for 88 

Question for jury 89 

Lender oil and gas permits and leases 273 

Under Oil and Cas Act 431 

PUBLIC DOMAIN 

All mines on are "open" 145 

Pipe lines across 165 

PUBLIC UTILITIES 

See Police Power 161 



INDEX 10 J5 

PUMPING TAGK 

Necessity of 182 

Saratoga water case 183 

PURCHASE MONEY 

Royalty treated as 99 

Q 

QUANTITY 

Of oil and gas to be expected in wells 3 

QUITCLAIM TO THE UNITED STATES 

When required 439 

R 

RAILROADS 

Lease of coal lands to prohibited except 264 

Combinations with pipe line and refinery 286 

May not hold coal leases or permits 430 

RAILROAD GRANT 

Not entitled to preference right 280 

READJUSTMENT 

Oi lenses in Alaska 428 

Of other leases 428 

REASONABLE TIME 

To sink 83 

RECEIVER 

See Injunction 394 

Instances of appointment of 199 

RECEIVER'S RECEIPT 

In application for patent 250 

RECIPROCITY 

As to rights of aliens 418 

RECORD 

Of location before discovery 229 

Of location certificate . 223 

Of patent 250 

Of placer claim, statutory requirements 866-877 



1096 INDEX 

RE-ENTRY page 

Not allowed after abandonment of lease Ill 

REFINERIES 

When nuisances 177 

Combinations with pipe line and railroad 286 

RELATION 

Of partnership, what creates 139 

RELIEF ACTS 

Concerning withdrawal legislation 505 

RELIEF CLAUSES 

Under proclamation of September 27, 1909 432 

RELIEF MEASURES 

Conditions for, under sec. 18 Oil Act L. 0. Reg 349 

What may be granted under sec. 18, L. 0. Reg 350 

Conditions for, under sec. 19 Oil Act, L. O. Reg 349 

Relief that may be granted under sec. 19, L. O. Reg 354 

Alaska claims under sec. 22, L. 0. Reg 354 

RELOCATION 

Of placer claim 242 

Presumption against the 243 

REMEDIES 

Choice of in forfeiture 123 

Election of in fraud cases 155 

REMEDY AT LAW 

Inadequate in injunction 196 

RENEWALS 

Of lease within known-geologic structure 275 

Clauses for in oil and gas leases 428 

RENTS AND ROYALTIES 

Covenant for runs with land 94 

Delay rentals 94 

Right of action for 95 

Periodical 96 

Payment or tender of 97 

By deposit or check 97 

To wrong party 98 

When lease repudiated 98 



INDEX 1097 

RENTS AND ROYALTIES— continued. pagf. 

None on use of oil or gas in operating 98 

Royalty treated as purchase money 99 

Pending litigation 100 

Recovery back of, when 1011 

Rent, when it ceases 100 

When lessor's title extinguished 100 

Royalty as property 100 

By-products, royalty on , 101 

Division of royalties among heirs 101 

REPORTS 

To Secretary of Interior, see Land Office Regulations— 

RESCISSION 

Party attempting must act promptly 146 

RESERVATION 

Of minerals in dedication of lots 13 

In conveyance 15 

Of minerals, taxable 157 

Of surface in leases 424 

RESTORED LAND 

Location of placer on , 243 

REWARD 

For discovery under Oil and Gas Permit, L. O. Reg 336 

For first oil or gas well in Nebraska 66<> 

RHODE ISLAND STATUTES 

Blue Sky Laws 818 

RIGHT OF WAY 

To pipe line 287 

For pipe lines, L. 0. Reg 363 

RIVER BEDS 

Minerals under 12 

ROADS AND TRAILS 

As improvements in patent application 245 

ROYALTY 

No, on coal for private use 267 

Leases within known-geologic structure 274 



1098 INDEX 

ROYALTY — con I inn ed. pag e 

On land withdrawn under proclamation 275 

On oil shale leases . 281 

Secretary may waive 281 

Distribution of, by United States 291 

Payment in kind 292 

Secretary of State may sell 292 

Private sale of 360 

On passed production 360 

Under phosphate lease 384 

Analysis of, on the several minerals 425 

Distribution of, under the Act 426, 427 

Reduction of, when 426 

See Rents and Royalties — 

ROYAL GRANT 

Patent equivalent to 247 

RULES AND REGULATIONS 

Secretary of Interior shall prescribe 290 

See Land Office Regulations — ■ 

RUSSIA 

Oil wells in 3 

s 

SALE 

Of oil by sample 153 

SALT WELL 

Oil found in 26 

SAN BERNARDINO COUNTY 

Excepted from sodium and borax leases 283 

SARATOGA WATER CASE 

See pumping 183 

SCRIPTURAL MENTION 

Of oil and gas 2 

SECOND LEASE 

First lease exclusive 103 

Subject to first 104 

Notice to prior lessee - 104 

Sublessee dealing underhand wilb owner 104 

injunction against • 105 



INDEX 1099 

SECRETARY OF INTERIOR tage 

Prescribe rules and regulations t 290 

SEEPAGE 

From ga a plant, is negligence . 173 

Of oil, not a discovery 227 

SET-OFF 

In ejectment actions 193 

SEVERANCE 

Of mineral estate ] 8 

Owner of surface, drilling thin coal vein 19 

In U, S. Patents 19 

Taxation of surface and minerals 137 

Oil Leasing Act applies when there is 291 

Withdrawal legislation concerning 508 

SEVERANCE, EXCEPTION, RESERVATIONS 

Two estates not hostile 18 

Adverse possession 18 

Drilling through coal vein 19 

Other incidents 19 

In late U. S. patents 19 

"SEVERED LAND 

Preference, agricultural rights to permit and lease 424 

SHAPE 

Of land, under Oil lease 271 

Of claims on unsurveyed land 422 

SHOOTING WELL 

Right to shoot , 1 8.5 

When not bound to shoot 3 85 

Premature explosion 180 

SINKING 

Depth of, under Oil and Gas Act , 270 

SINKING WELLS 

Covenant as to 82 

Reasonable time for S3 

Default on time in S3 

Point of 84 

Business judgment in S<o 

Waiver of covenant for . . 80 

In wildcat territory 87 



1100 INDEX 

SIZE PAGE 

Of claims on unsurveyed land 422 

SODIUM 

Definition of, see Glossary 97S 

SODIUM AND BORAX 

Sections 23-25 of Oil Leasing Act 283 

Two year permits 283 

San Bernardino County excepted 283 

Leases to permittees 283 

Mill site privileges 284 

Locations before passage of Oil Act protected 293 

Analysis of royalty on 420 

SODIUM, LAND OFFICE REGULATIONS 

Permit for exploration 390 

Qualifications of applicants 390 

Land to which applicable 390 

Rights under 390 

Reward for discovery 397 

Camp sites 397 

Contents of application for 397 

Form of 398 

Lease for sodium lands 400 

Qualifications of applicants 400" 

Area and description 400 

Action by register and receiver 401 

Notice of application 401 

Action in General Land Office 401 

Lease by permittee 402 

Verity of statements , 402 

Lease a waiver of other claims 402 

Contents of application for , 402 

Disposition of application 404 

Form of lease 405 

Wse permits for camp site 41.1 

Form of 413 

Repealing and saving clauses 413 

Form of application for permit 41o 

SOUTH CAROLINA STATUTES 

Blue Sky Laws 819 

SOUTH DAKOTA STATUTES 

Blue Sky Laws 819 



INDEX . 1101 

SPACING WELLS page 

For protection « • • 33 

SPECIFIC GRAVITY 

Of the elements, see Glossary 96 i 

SPECIFIC PERFORMANCE 

Bill must allege consideration . .-. 202 

When granted ' 202 

Expenditure on permanent improvements 202 

Of bids advertised for on a lease 202 

When denied 203 

For organization of a corporation 204 

Laches 204 

Danger of eviction excuse for nonpayment . . 204 

""Allowing time to secure consent to assignment 204 

STAKING 

Of oil location before discovery 229 

Of placer locations 235 

When new, required 235 

Corners, in tract described in permit 271 

Of placer claims, statutory requirements 866-877 

STANDARD 

Oil below, in negligence case __. 173 

STATE LAWS 

To be respected in Oil Act leases 290, 386 

STATE REQUIREMENTS 

For oil placer locations 225 

STATES 

Police power of, over Oil Act lessees 290 

May levy taxes on lessees 290 

STATE STATUTES, OIL AND GAS 

Alaska 553 

California 554-588 

Colorado 589-596 

Illinois 596-599 

Indiana 599-620 

Kansas *• 621-637 

Kentucky 637-649 

Louisiana (New Acts Inssrted) . fct 649-669 



1102 . INDEX 

STATE STATUTES, OIL AND GAS— continued. page 

Nebraska 669 

New Mexico 669-671 

New York 67 1-682 

Ohio 682-697 

Oklahoma '. 698-740 

Pennsylvania 740-766 

Tennessee 7 766-769 

Texas ...>.. 51 7-552 

West Virginia 769-790 

Wyoming 790-797 

STATUTES OF FRAUDS 

Assignment or surrender of lease, when must be in writing 149 

Cases not within 150 

Simultaneous records "150 

STATUTE OF LIMITATIONS 

See Laches 146 

When runs from wrong and not from discovery -.' 147 

STATUTORY LEGISLATION ON PLACER LOCATIONS 

Alaska ' 866 

Location notice 866 

Staking 867 

Blazing line stakes 867 

Location certificate, record 867 

Arizona . ; 868 

California 868 

Colorado 869 

Idaho 869 

Affidavit, required 870 

Montana 871 

Verification required 872 

Nevada 873 

New Mexico ; . . 874 

Washington 875 

Location notice, staking 875 

Record, monuments 875 

Discovery work 876 

Affidavit of performance 876 

Wyoming 876 

STATUTORY LIABILITY 

For accidents in gas transportation 174 



INDEX 110-J 

STATUTORY LICENSES pack 

No ejectment under by licensee . , 131 

STOCK 

Ownership of prohibited in Oil Leasing Act, when 263 

STORAGE 

Of gasoline, when negligence > 172 

Of naphtha vapor, when negligence 172 

STRIKES 

Suspension of operations under coal lease 266 

Provided for in coal and phosphate leases- 424 

SUB-HEADS OF OIL ACT AND REGULATIONS 

Minerals, parties, and leasable domain 417 

Gas 417 

Helium 417 

Phosphates and sodium 417 

Mill sites 417 

Parties ". 417 

Proof of citizenship . . . . 418 

Aliens 418 

Reciprocity 418 

Declarants _. 418 

Citizenship of corporation 418 

Alaska 419 

Exclusions 419 

Saving clauses : 420 

Preference, permits and leasas 421 

Limitations of acreage 421 

Alaska 422 

Limitations on number of leases 422 

Leases and permits on unaurveyed land 422 

Size and shape 422 

Term of lease 423 

Waste of oil and gas 423 

Payment of wages 424 

Eight hour day » 424 

Minors and women 424 

Coal weighing 424 

Strikes 424 

Severed lands ; . 424 

Reservation of surface 424 

Advertisements 424 



1104 INDEX 

SUB-HEADS OF OIL ACT AND REGULATIONS— continued. PAGE 

Rents and royalties 425 

Coal 425 

Phosphates 425 

Oil 425 

Oil shale 426 

Sodium 426 

Distribution of the royalties 426, 427 

Reduced oil and gas production 426 

Waivers of 426 

Bonus 427 

Renewals, extensions, surrender, readjustment, assignments, sub- 
leases, and forfeiture 428 

Renewals 428 

Extension of permit ...... ... * ,.,.*. .-.>. 428 

Surrender of lease 428 

Readjustment 428 

Combined or modified coal leases 429 

Consolidation of phosphates leases 429 

Assigns and subleases 429 

Forfeiture 429 

Easements, protection and taxes 430 

Pipe lines 430 

Raikoads 430 

Protection 431 

Taxation 431 

Proclamation and relief clauses 432 

Claims without discovery 432 

Class of beneficiaries under the proclamation 433 

Assigns from claimants 433 

Proclamation compromises 433 

Controverted claims 434 

Adverse claims 434 

Arbitration 434 

Deprecatory clauses 436 

Corporations 436 

Fraud 437 

Trusts , 437 

Combinations 437 

Practice, miscellaneous 439 

Bids 439 

Quitclaim to the United States 439 

Verification 439 

Fees and commissions 439 



INDEX 1105 

SUBLEASE PAGE 

Assignment of , 107 

SUBLESSEE 

Dealing underhand with owner 104 

Injunction against 105 

SUBLETTING 

Of lease forbidden under Oil Act 289 

SURFACE 

Owner of, drilling through conveyed coal vein 19 

Reservation of, in leases 424 

SURRENDER 

Of lease, when must be in writing 149 

Of lease by lessee 428 

SURRENDER CLAUSE 

In leases 76 

Object and effect 77 

Not automatic 77 

Associated with delay rentals 78 

Right to surrender 79 

Assigns protected, when " 81 

SURVEYS 

Of unsuryeyed tract at expense of applicant 272 

SYMBOLS 

Of the elements, see Glossary 964 

T 

TABLE OF ELEMENTS 

See Glossary 96 . l 

TAXATION 

Prospective value not taxable 155 

Separate ownership of surface and mineral ]57 

Possessory title 157 

Reservation of minerals taxable 157 

Unconscionable assessment 157 

Gross proceeds 157 

Net proceeds 158 

License and inspection tax 158 

M. 0. R.— 70. 



1106 INDEX 

TAXATION" — con tin. ued. tagi: 

Income tax 150 

On nonresidents 160 

On perpetual lease 160 

Oil in transit under Interstate Commerce 160 

TAXES 

States may levy against Oil Act lessee , 290 

Under Oil and Gas Act 431 

TENANT 

No estate in oil until tapped ^ 21 

TENANTS IN COMMON 

Separate owners of land and mineral are not 19 

TENDER 

Of rents and royalties 97 

By deposit or check 97 

To wrong party ■..-...■ 98 

When lease repudiated 98 

TENNESSEE STATUTES 

Oil and Gas Acts — 

Casing wells to protect against water -, 766 

Abandoned wells, how to be closed 767 

Danger of waste of gas to be prevented 767 

Adjoining owners may plug 768 

Owner and other terms defined t 768 

Penalty 769 

Relief in equity against waste . 769 

Blue Laws 819 

TERM OF LEASE 

Reference to paying quantity 51 

Time to drill 52 

Lessee entitled to notice of termination 53 

Enjoined, time extended 54 

Of various leases under Oil Act 423 

TERMS 

To be expressed in Oil Act leases * 280 

TERRITORIAL EXTENT 

Of protection from wells 32 



INDEX 1107 

TEXAS page 

Oil and gas lands in 517 

Drilling corporatieHa 517 

Bonds and receiver in injunction suits 518 

General Oil and Gas Act 519 

Rents relinquished on oil and gas 520 

Owner may sell or lease • 520 

1000 foot protection 521 

Forfeiture if offset well not sunk , 521 

Sale after forfeiture 522 

Bidder must sink 522 

Double royalty to State and owner 522 

Royalties. To what fund credited 523 

Liens to State and owner 523 

Forfeiture for breach of lease 523 

Conflicting permits 524 

Severance of mineral and surface rights 524 

Assignments and combinations of permits 525 

Time to commence drilling 525 

Report of oil strike 526 

Verified log 526 

Lease when issues 526 

Rents and royalties 526 

Surrender of permit 527 

Permits on university land 527 

Off-set damages to soil 527 

Saving clause 527 

Oil and Gas Conservation Law 528 

Waste defined and prohibited 528 

Wa-te, leaks. Protection against water .-..'- 529 

Duties of Railroad Commission 529 

Pipe line expert 530 

Deputy Supervisors 530 

Certificate required from pipe line company 531 

Books to be open to stockholders .' . 531 

Double penalties imposed 531 

Senate Substitute Bill Xo. 36 '. 532 

Operators to Iceep books and make report 532 

Oil and Gas Circular Xo. 11 533 

Waste prohibited 533 

"Waste" defined 533 

Gas to be confined 534 

Strata to be protected 534 

Approved methods of preventing waste to be used 534 

"Commercial Quantities" defined 534 

Gas to be taken ratably 535 



1108 INDEX 

TEXAS — con tmued. 

Oil and Gas Circular No. 11 — continued. page 

Commission regulate taking of gas 635 

Gas to be metered 535 

Notice of intention to drill, deepen or plug 535 

Plugging dry and abandoned wells 536 

Manner of plugging 536 

Notice of intention to plug 536 

Log and plugging record to be filed 536 

Proper anchorage to be laid 536 

Equipment for conserving gas 536 

Separate slush pit 537 

Producing oil and gas from different strata 537 

Strata to be sealed off 537 

Density of mud fluid 537 

Mud laden fluid to be applied when 537 

Fresh water protected * 538 

Separating devices 538 

Production from different sands at same time 538 

Shooting of wells - 539 

Gauge to be taken 530 

Reports to Commission 539 

Production restrained to 50% 530 

Notices of fires, breaks and leaks . 540 

Pipe line companies, reports 540 

Connection with wells 540 

Drilling records to be kept 541 

Conservation agents access to 541 

Books and reports 541 

Notice to contractors and others 542 

Conservation agents 542 

Co-operation with Federal Inspectors 542 

Enforce rules 542 

Supplement to circular No. 11 543 

Act regulating pipe lines 545 

Are common carriers except when 545 

Limitations upon 546 

Right of way 547 

Regulations, hearings, rates, complaints 548 

Exchange of tonnage ■ 548 

Commission's orders 548 

Monthly reports 549 

Discrimination forbidden, 3.000 barrel limit 550 

Waste 550 

Penalties 551 



INDEX 1109 

TEX AS— con t inued. 

Act regulating pipe lines — continued. pagf. 

Discrimination 551 

Expert and other assistants 552 

Special tax 552 

Blue Sky Laws 819 

, Trust agreements ; 913 

TIME 

Of option 120 

Extension of 127 

TITLE 

Source of, to oil lands 6 

To minerals under ocean, lakes, rivers and highways 11 

Separate, in minerals and lands 12 

To minerals, under lease , 59 

Patent vests in fee 247 



TONNAGE 

Minimum, in coal leases . . 266 

TOOLS 

Fishing for, part of contract to sink 132 

Receiver should pay for use of 200 

TORT 

Waiver of, by cotenants 48 

TRANSPORTATION 

Under Interstate Commerce 1 69 

TRESPASS 

Distinction between, and trover 201 

Measure of damages in 207 

TRIBAL LANDS 

See Indians 216 

TROVER 

Distinction between, and trespass 201 



lilO INDEX 

TRUST AGREEMENTS pag£ 

Forms of qh ; 93s 

See trusts 911 

TRUSTS 

Jn chain of title 248 

Ground for forfeiture of lease 286. 437 

Business trust agreements 911 

Advantages of 912 

Disadvantages of 912 

Used in Massachusetts 912 

Texas trusts ' 913 

Oklahoma Trust Agreement Act 913 

Rule against perpetuities 914 

Judicial recognition of 914 

Forms of , 915, 938 

u 

UNILATERAL 

Leases construed strictly 73 

U. S. PATENTS 

Severance of mineral in 10 

U. S. STATUTES 

Withdrawal Acts 255 

Pickett Acts 7 . . ...... 255 

Oil Leasing Act 262 

Alaska Coal Act 822 

UNSURVEYED LAND 

Leases and permits on 422 

Size and shape of claim on ". 422 

USE 

Of oil or gas in operating 99 

USE PERMITS 

Under phosphate lease 391 

For camp sites etc., with sodium lease 411 

UTAH 

Severance Act of 1912 509 

Blue Sky Laws 819 



INDEX 1111 



V 



VALUE page 

Opinions as to, in fraud cases 152 

Prospective, not taxable 154 

VERIFICATION 

Of papers required by Secretary of Interior 291 

When required by Secretary of Interior 439 

Before whom made 439 

To location of placers in Montana 872 

VERMONT STATUTES 

Blue Sky Laws „ 820 

VIRGINIA STATUTES 

Blue Sky Laws ............ 820 

w 

WAGES 

See Land Office Regulations — 

Payable bimonthly under Oil Act leases • •••?.• 289 

Leases shall provide for payment of 424 

WAIVER 

Of forfeiture by accepting rent . 118 

By laches or estoppel . :i ........ . . 120 

Of fraud •; 155 

Of rents and royalties under Oil Act ••.••• 42G 

WASHINGTON STATUTES 

Location of placers , . ..... 875 

Location notice, staking 875 

Record, monument 875 

Discovery work, oil and gas excepted ............ ... 870 

Affidavit of performance 876 

WASTE OF OIL OR GAS 

Wanton waste '. :; .«; 1 87 

Plugging the well .-'. . 188 

Flambeaux lights , 188 



i ■> 



Prevention of, under oil and gas lease 

Oil Act Leases shall provide against 289 

Prohibited 423 



1112 INDEX 

WELL PAGE 

Judicial notice that oil is mined by 24 

Spacing for protection 33 

implied covenant for protection 34 

Successive wells for protection 34 

Contract for a completed 134 

Between, and pipe line 138 

Flowage from, as negligence 171 

Killing, when negligence 175 

Right to shoot 385 

When not bound to shoot 185 

Premature explosion in ] 86 

Plugging 188 

WEST VIRGINIA STATUTES 
Oil and C4as Acts — 

Casing against water 760 

Plugging and casing abandoned wells 770 

Prevention of waste of gas 770 

Several strata 770 

When adjacent owner or operator may plug 771 

Owner and sand defined 771 

Penalty 772 

Equity may enjoin waste 772 

Limitation to protect oil lessee 772 

Pipe line company may condemn 773 

Are common carriers 773 

Act regulating transportation of oil 774 

Pipe lines and storage companies 774 

Make connection and accept deliveries 774 

Oil inspected, graded and measured ; 774 

Rates allowed for transportation 775 

Storage and demurrage 775 

Inspection and measurement before carriage 775 

Allowance for waste . 7*5 

Loss from overflow 775 

Statutory charges fixed 777 

When demurrage begins 777 

2 % limit to deductions 777 

Discrimination and rebates disallowed 778 

• Fine and damages for overcharges 778 

Lien for carriage and storage 778 

Pipe line receipt negotiable 778 

Delivery of oil not to be anticipated 779 

Precautions against duplicate 779 

Cancellations 779 



INDEX • U13 



WEST VIRGINIA STATUTES— aon tin ued. 

Oil a-nd Gas Acts — continued. . page 
Removal of oil without written consent of owner . . 780, 7S2 

Verified monthly statements posted 780 

Oil on hand to tally with vouchers 781 

Fine and imprisonment for unauthorized vouchers 782 

Unconscionable fines for failure to make reports 782 

Oil owners demand showing 783 

False report or corrupt conduct of examiner 784 

Refusal to furnish information a misdemeanor 784 

Natural gas distribution and exportation 785 

Power of Commission to compel supply 78o 

To compel connections 786 

Prior Public Service Commission Acts 787 

Injunction, mandamus and other relief 788 

Fines and imprisonment 788 

Civil remedy 789 

Defendant compelled to criminate himself 789 

"Person" defined 789 

Blue Sky Laws 820 

WILDCAT TERRITORY 

Protection well in 39 

Construction of lease of land in ....'. 65 

WISCONSIN STATUTES 

Blue Sky Laws 820 

WITHDRAWAL ACTS 

Review of statutes and decisions 255 

Pickett Act, consideration of 255 

WITHDRAWAL LEGISLATION 

Locations in withdrawn area 502 

Ori/inal withdrawal Act 503 

Authority to withdraw , 503- 

Only coal, oil, gas and phosphates covered «..<-, 503 

Rights of oil seekers preserved 503 

Claims initiated after withdrawal 504 

Agricultural entries protected 504 

New Forest Reserves prohibited 501 

Withdrawals to be reported 504 

Enactment and. provisos of Act 504 

Amendment of 1912 505 



1114 INDEX 

WITHDRAWAL LEGISLATION— con tin tied. 

Locations in withdrawn areas — continued-. page 

Relief Acts of 1911 and 1914 505 

Prior transfers validated 506 

Withdrawn lands excepted 507 

Impounding oil proceeds pending controversies .... 507 

Navy petroleum fund 508 

Severance of surface and mineral estates 508 

Potash 508 

Utah Severance Act 510 

Idaho Act 510 

WITNESS 

Lease may be valid without 55 

WOMEN 

Leases shall provide for protection of 424 

WORK 

Suspension of, under coal lease when allowed 266 

Suspension of, under phosphate lease 269 

WORKING INTEREST 

Construed in lease 142 

WRITING 

Controls printing in lease 62 

WYOMING 

Form of lease 493 

Acknowledgment to 496 

WYOMING STATUTES 

Oil and Gas Acts — 

Ten days allowed to stop waste 790 

Abandoned wells, how plugged 790 

Shot wells 790 

Proof of plugging to be recorded 791 

Fine for violation 791 

Adjacent parties may plug at owner's cost 792 

Tax Act- 
Gross product of well to be assessed 792 

Owner to make report of product 792 

State board to fix the valuation 793 



INDEX 1115 

WYOMING STATUTES— continued PAGft 

State geologist 79:5 

Appointment of 793 

Oath and bond of 794. 

Removal from office 794 

General duties '. . 794 

Salary 795 

Disqualification of . . . 795 

Natural gas, failure to utilize 795 

Wasteful use in certain processes 795 

Confiscatory penalty . . 79(> 

Location of placers , . 876 

Location certificate 870 

Location notice and staking 876 

Blue Sky Laws 820 

z 

ZUBULOFF WELL 

Spouted 350 feet 4 



